Mumbai: Hindustan Petroleum Corporation Limited (HPCL) reported a sharp decline in profitability for the first quarter of financial year 2026-27 (Q1 FY27), with the company posting a standalone net loss of ₹11,526.41 crore compared with a profit of ₹4,370.87 crore in Q1 FY26.
Despite the loss, HPCL recorded strong growth in revenue, with revenue from operations increasing 20.8% year-on-year to ₹1,45,126.22 crore. Total income also increased by 21.3% to ₹1,46,407.30 crore during the quarter.
The company’s shares remained in focus following the announcement of the quarterly results.
HPCL Q1 FY27 Financial Highlights
Key standalone financial performance during Q1 FY27:
- Revenue from operations increased 20.8% year-on-year to ₹1,45,126 crore compared with ₹1,20,135 crore in Q1 FY26.
- Total income rose 21.3% to ₹1,46,407 crore from ₹1,20,658 crore in the previous year.
- Profit before tax (PBT) stood at a loss of ₹17,446 crore, compared with a profit of ₹5,826 crore in Q1 FY26.
- Standalone net profit turned into a loss of ₹11,526 crore, against a profit of ₹4,371 crore last year.
- Basic earnings per share (EPS) declined to -₹54.17 from ₹20.54 in Q1 FY26.
The company’s pre-tax performance declined significantly due to pressure on margins and higher expenses.
Strong Refining Margins Could Not Prevent Quarterly Loss
HPCL reported a major improvement in its Gross Refining Margin (GRM), which increased to US $23.80 per barrel in Q1 FY27 compared with US $3.08 per barrel in Q1 FY26.
However, the benefit from strong refining margins was offset by losses in petroleum product marketing margins.
HPCL attributed the quarterly loss mainly to:
- Suppressed marketing margins on petroleum products.
- Higher input costs.
- Negative LPG buffer impact.
The company stated that the cumulative negative buffer on LPG stood at ₹16,405.92 crore. It also recognized ₹1,980 crore as government compensation for LPG under-recoveries during the quarter.
Expenses Rise Faster Than Revenue Growth
HPCL’s expenses increased significantly during Q1 FY27, impacting profitability.
Major cost movements included:
- Cost of materials consumed increased 74% year-on-year to ₹63,562.06 crore.
- Purchases of stock-in-trade increased 55% to ₹91,982.55 crore.
- Total expenses rose 43% to ₹1,63,853.40 crore.
The rise in expenses outpaced revenue growth, resulting in a negative operating margin.
HPCL’s standalone operating margin stood at -12.38%, compared with 5.04% in Q1 FY26.
Consolidated Loss Stands at ₹12,265 Crore
On a consolidated basis, HPCL reported a net loss of ₹12,264.67 crore in Q1 FY27.
This compares with:
- Profit of ₹4,110.93 crore in Q1 FY26.
- Profit of ₹6,065.26 crore in Q4 FY26.
Consolidated total income increased approximately 21% year-on-year to ₹1,45,844 crore.
The consolidated downstream petroleum segment reported a loss of ₹17,712.65 crore, compared with a profit of ₹6,144.10 crore during the same period last year.
Operational Performance Remains Stable
Despite financial pressure, HPCL’s operational performance remained largely stable.
Operational Highlights:
- Crude throughput stood at 6.52 million metric tonnes (MMT) compared with 6.66 MMT in Q1 FY26.
- Domestic sales remained almost flat at 12.24 MMT compared with 12.26 MMT last year.
- Exports increased to 0.88 MMT from 0.78 MMT.
- Pipeline throughput stood at 6.61 MMT compared with 6.70 MMT in Q1 FY26.
Domestic sales remained almost unchanged, while exports increased during the quarter.
HPCL Debt Increases, Net Worth Declines
The company’s balance sheet faced pressure following the quarterly loss.
Standalone financial position as of June 30, 2026:
- Outstanding debt increased to ₹72,596.95 crore, compared with ₹47,598.66 crore at the end of March 2026.
- Debt increased by nearly 52% in one quarter.
- Net worth declined to ₹47,735.73 crore from ₹59,847.09 crore.
- Debt-equity ratio increased to 1.52 times from 0.80 times at the end of March.
On a consolidated basis:
- Debt increased to ₹75,913.53 crore.
- Net worth declined to ₹52,930.37 crore.
- Debt-equity ratio rose to 1.43 times.
HPCL Segment Performance
The consolidated segment performance showed continued pressure in downstream petroleum operations.
Downstream Petroleum Segment:
- Revenue: ₹1,45,127 crore
- Segment Result: Loss of ₹17,713 crore
Other Segments:
- Revenue: ₹184 crore
- Segment Result: Loss of ₹27 crore
The downstream segment remained impacted by weaker marketing margins despite improved refining performance.
HPCL Outlook: Focus on Refining Strength and Market Recovery
The company’s Q1 FY27 performance highlights the challenges faced by oil marketing companies due to fluctuations in fuel marketing margins, input costs and LPG subsidy-related impacts.
With strong refining margins and stable operational performance, HPCL is expected to focus on improving profitability through better margins, operational efficiency and market recovery.
About Hindustan Petroleum Corporation Limited (HPCL)
Hindustan Petroleum Corporation Limited (HPCL) is a Maharatna public sector undertaking and one of India’s leading oil refining and marketing companies. It operates across the petroleum value chain, including refining, distribution, and fuel marketing, playing a key role in meeting the country’s energy needs.
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