HPCL shares declined 3.67% to ₹380.70 following the release of Q1 FY27 results that showed a consolidated net loss of ₹12,264.67 crore, compared with a net profit of ₹4,110.93 crore in Q1 FY26. According to Moneycontrol, the stock was trading at ₹380.70 at 11:53 AM on NSE on Thursday, July 23. The market reaction reflects investor concerns about the company's first quarterly loss since Q3FY23, with the performance significantly impacted by the West Asia conflict which pushed up crude oil prices. Of the 33 analysts covering HPCL, 15 have a 'buy' rating, seven have a 'hold' rating, and 11 have a 'sell' rating. Notably, Jefferies has an 'underperform' rating with a price target of ₹345 per share, indicating a downside from the previous close. Macquarie maintained its 'outperform' call with a target price of ₹490, describing Q1FY27 as a likely trough quarter and expecting near-term earnings to remain volatile for oil marketing companies.
HPCL reported a consolidated net loss of ₹12,264.67 crore in Q1 FY27, which was significantly worse than the ₹4,110.93 crore profit reported in Q1 FY26. According to Moneycontrol, the company's revenue from operations rose 21% year-on-year to ₹1.44 lakh crore from ₹1.19 lakh crore, while total income also increased 21% to ₹1.45 lakh crore. Despite the loss, the company demonstrated strong revenue generation with total income (excluding excise duty) increasing 26.9% year-on-year to ₹1,39,889.86 crore in Q1 FY27. Operating margin deteriorated to negative 12.38% in Q1 FY27 from 5.04% in the year-ago quarter, while net profit margin slipped to negative 7.94% from 3.64%. The financial performance was significantly impacted by the West Asia conflict which pushed up crude oil prices while PSU OMCs sold petrol, diesel and LPG at below market cost, impacting margins.
Despite the significant loss, HPCL demonstrated strong revenue growth during the quarter. Total sales volume, including exports, increased 0.6% YoY to 13.12 MMT in Q1 FY27, according to Business Standard. Combined petrol (MS) and diesel (HSD) sales rose 8.1% to 8.8 MMT, while LPG sales stood at 1,729 thousand metric tonnes (TMT). Pipeline throughput during the quarter was 6.61 MMT. Crude throughput increased 1% sequentially to 6.52 million tonnes, operating at 107% of installed capacity. Average Gross Refining Margin (GRM) surged to $23.80 per barrel during the June quarter from $3.08 per barrel a year earlier, before accounting for the impact of Special Additional Excise Duty and Road & Infrastructure Cess on exports. However, suppressed marketing margins on certain petroleum products adversely impacted profitability, as reported by Business Standard.
The company's financial performance was significantly impacted by the West Asia conflict which pushed up crude oil prices while PSU OMCs sold petrol, diesel and LPG at below market cost, impacting margins. HPCL booked an LPG under-recovery of ₹5,600 crore in the first quarter, compared to ₹1,400 crore sequentially, with a cumulative net negative buffer of ₹6,400 as of June 2026-end. The LPG compensation loss of ₹1,980 crore was received in the June quarter toward under-recoveries made in FY25, being paid in 12 equal monthly instalments. The cumulative negative buffer on LPG as of June is at ₹16,406 crore, compared to ₹16,405.92 crore as of June 30, 2026. Motilal Oswal noted that HPCL's EBITDA loss stood 37% higher than its estimate at ₹161.3 billion due to weaker-than-estimated marketing margins, while Nomura also highlighted that HPCL's EBITDA loss of ₹161 billion was worse than their estimate for ₹139 billion loss, largely due to higher-than-expected losses in fuel retailing.
HPCL incurred capital expenditure of ₹1,734 crore during the quarter, primarily towards strengthening refining and marketing infrastructure, expanding capacities through subsidiaries and joint ventures, entering new business segments, and improving operational efficiencies. As reported by Business Standard, the company continued to expand its retail network during the quarter. As of June 30, 2026, HPCL had 25,160 retail outlets, 6,391 LPG distributors and 54,586 PNG connections. Its city gas distribution (CGD) network also expanded with the addition of 598 inch-km of steel pipelines and 693 inch-km of MDPE pipelines. The operational improvements, including increased crude throughput and higher GRM, were partially offset by the significant retailing losses and LPG under-recoveries that impacted overall profitability.
