Mumbai: Bharat Petroleum Corporation Limited (BPCL), a state-owned oil marketing company, announced its financial performance for the second quarter of the financial year 2026-27, ended September 30, 2026.
The company’s consolidated net profit declined amid pressure on marketing margins, although revenue and operational volumes recorded healthy growth. BPCL returned to profitability after reporting a consolidated net loss of approximately ₹1,872.70 crore in Q1 FY27.
The company’s quarterly performance was supported by higher refinery throughput, increased domestic fuel sales, strong export growth and the recognition of compensation for under-recoveries on domestic LPG sales.
BPCL Q2 FY27 Financial Results
BPCL reported a decline in consolidated net profit despite a substantial increase in revenue from operations during the July-September quarter.
The key financial highlights for Q2 FY27 are:
- Consolidated net profit: ₹4,863.05 crore, down 21.5% from ₹6,191.49 crore in Q2 FY26.
- Revenue from operations: Approximately ₹1.58 lakh crore, up 30% year on year.
- Previous quarter performance: The company reported a consolidated net loss of approximately ₹1,872.70 crore in Q1 FY27.
- Refinery throughput: 10.41 million tonnes, an increase of 6% year on year.
- Domestic market sales: 13.47 million tonnes, up 6.33% year on year.
- Exports: Increased 64% year on year.
- Key pressure on earnings: Lower marketing margins on certain petroleum products, partially offset by higher refining margins.
The results indicate that BPCL’s revenue growth did not translate into higher net profit, as marketing margins continued to affect earnings.
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BPCL Profit Declines Due to Pressure on Marketing Margins
BPCL attributed the decline in quarterly profit primarily to suppressed marketing margins on certain petroleum products. Higher refining margins partially offset the impact.
Oil marketing companies face pressure when the cost of crude oil and refined products rises faster than the prices charged to consumers. When retail fuel prices do not adjust in line with input costs, marketing margins can narrow and reduce profitability.
During the first quarter of FY27, BPCL reported a consolidated net loss of approximately ₹1,872.70 crore amid elevated energy prices and delayed retail fuel price increases.
Crude oil prices crossed $100 per barrel during the period of heightened energy market volatility. State-owned oil marketing companies refrained from increasing petrol and diesel prices until early May, even as crude oil prices remained elevated.
The companies subsequently increased retail fuel prices four times across the country in May, raising petrol prices by ₹7.38 per litre and diesel prices by ₹7.52 per litre.
These price increases helped improve marketing margins, supporting BPCL’s return to profitability in Q2 FY27. However, the company’s net profit remained below the level recorded in the corresponding quarter of the previous financial year.
BPCL Revenue Rises 30% in Q2 FY27
BPCL’s revenue from operations increased approximately 30% year on year to ₹1.58 lakh crore in Q2 FY27.
The growth was supported by higher refinery throughput, increased domestic market sales and a sharp rise in exports.
The key operational highlights for the quarter include:
- Refinery throughput: Increased 6% year on year to 10.41 million tonnes.
- Domestic market sales: Rose 6.33% to 13.47 million tonnes.
- Exports: Increased 64% year on year.
- Revenue from operations: Grew 30% to approximately ₹1.58 lakh crore.
Higher refinery throughput indicates that BPCL processed more crude oil during the quarter compared with the year-ago period. Growth in domestic sales and exports also contributed to the company’s operational performance.
Despite the increase in business volumes, profitability remained under pressure because of marketing margins and the overall energy market environment.
BPCL Reports LPG Under-Recoveries of ₹17,334 Crore
BPCL’s financial performance was also affected by under-recoveries on domestic liquefied petroleum gas (LPG) sales.
As of September 30, 2026, the company’s under-recoveries on domestic LPG sales stood at ₹17,334.40 crore.
Under-recoveries arise when the realisation from selling a product is insufficient to cover the relevant costs. In the case of domestic LPG, government-directed pricing and elevated input costs can result in losses for oil marketing companies.
To address these under-recoveries, the Ministry of Petroleum and Natural Gas approved compensation of ₹7,594 crore for BPCL. The compensation covers under-recoveries incurred on domestic LPG sales up to March 2025 and those expected to be incurred up to March 2026.
According to the company’s exchange filing, the compensation is being disbursed in 12 equal monthly instalments, with monthly accruals beginning in November 2025 and corresponding disbursements thereafter.
BPCL recognised six monthly instalments during the reporting period, amounting to ₹3,796.98 crore, under revenue from operations.
The compensation provides financial support against LPG-related under-recoveries, although the company’s reported under-recoveries remained substantial as of the end of September 2026.
BPCL Returns to Profitability After Q1 FY27 Loss
BPCL’s Q2 FY27 performance marked a recovery from the loss reported in the preceding quarter.
In Q1 FY27, the company recorded a consolidated net loss of approximately ₹1,872.70 crore. The loss was attributed to elevated energy prices and pressure on marketing margins.
In Q2 FY27, BPCL returned to profitability with a consolidated net profit of ₹4,863.05 crore.
The quarter-on-quarter improvement was supported by the following factors:
- Improved marketing margins following retail fuel price increases in May.
- Higher refining margins, which partially offset pressure on marketing margins.
- Growth in refinery throughput and domestic fuel sales.
- Strong export growth.
- Recognition of ₹3,796.98 crore in LPG compensation instalments under revenue from operations.
However, the company’s year-on-year net profit declined 21.5%, indicating that its earnings had not fully recovered to the level recorded in Q2 FY26.
BPCL H1 FY27 Results: Net Profit Falls 77%
For the first half of FY27, BPCL reported a consolidated net profit of ₹2,990.35 crore, down approximately 77% from ₹13,030.51 crore in the corresponding period of FY26.
The sharp decline in first-half profit reflects the impact of weak marketing margins and elevated crude oil prices, particularly during the first quarter of the financial year.
The key first-half financial figures are:
- Consolidated net profit in H1 FY27: ₹2,990.35 crore.
- Consolidated net profit in H1 FY26: ₹13,030.51 crore.
- Year-on-year decline: Approximately 77%.
- Q1 FY27 performance: Consolidated net loss of approximately ₹1,872.70 crore.
- Q2 FY27 performance: Consolidated net profit of ₹4,863.05 crore.
The recovery in Q2 helped BPCL return to profitability, but the first-quarter loss significantly affected its cumulative earnings for the first six months.
Crude oil prices exceeding $100 per barrel during the period of heightened energy market volatility also contributed to pressure on the company’s marketing margins.
Key Factors to Watch in BPCL’s Performance
BPCL’s Q2 FY27 results highlight several factors that may influence its financial performance in subsequent quarters.
- Crude oil prices: Changes in international crude oil prices can affect refining costs and marketing margins.
- Retail fuel prices: The relationship between fuel procurement costs and retail selling prices remains important for profitability.
- Refining margins: Higher refining margins can help offset pressure from marketing operations.
- LPG compensation: Government compensation for domestic LPG under-recoveries can provide financial support to the company.
- Sales and exports: Continued growth in domestic fuel sales, refinery throughput and exports may support revenue.
- Marketing margins: A sustained recovery in marketing margins will be important for improving earnings.
Overall, BPCL delivered strong revenue growth and returned to profitability in Q2 FY27, but its lower year-on-year net profit and sharp first-half earnings decline highlight the continuing impact of marketing margin pressure.
About Bharat Petroleum Corporation Limited (BPCL)
Bharat Petroleum Corporation Limited (BPCL) is a Maharatna public sector enterprise under the Ministry of Petroleum and Natural Gas, Government of India. Headquartered in Mumbai, the company operates in the oil and gas sector, with businesses spanning crude oil refining, petroleum product marketing, fuel retailing, LPG distribution and related energy services. BPCL operates refineries and a nationwide fuel distribution network, supplying petroleum products to consumers, businesses and industrial customers across India.
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