Weekly Recap: Q2 earnings & capex plan and export duty changes

What happened

Bharat Petroleum reported Q2 EBITDA of ₹90bn, profit of ₹4,993cr, refinery runs at 117% and a $32.5/bbl refining margin. The government raised diesel export duty to Rs 11.5/litre and cut petrol export duty to zero. BPCL also reported LPG under-recoveries of ₹17,334.40 crore through September.

Confirmed

Global impact / market context

Higher diesel export duty raises the cost of selling diesel abroad, which can reduce profit per sale on exported fuel for state oil firms like BPCL. LPG under-recoveries, meaning costs not covered by subsidies, tie up cash and can pressure near-term earnings and capital spending plans.

Analyst inference

BPCL is shifting crude sourcing toward the Middle East while Russian oil was about 37% of July–September purchases. Policy duty changes and delayed LPG subsidy payments affect revenue, costs and cash available, and may shape how investors view state-owned oil companies' earnings and spending.

Analyst inference

What to watch

1. BPCL plans capital spending of ₹1.7 lakh crore across refineries, gas, petrochemicals and green energy, a large commitment that will draw on cash available and future earnings. Confirmed
2. Watch whether the government adjusts diesel and petrol export duties again in coming fortnights, since these changes directly affect state oil firms including BPCL and their profit per sale. Proposed
3. Track LPG under-recoveries and subsidy payment timing; if under-recoveries rise as noted, BPCL's costs and cash available could tighten, affecting earnings and spending capacity. Analyst inference

Evidence

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