Hindustan Petroleum Corporation Limited (NSE: HINDPETRO) Q4 2025 Earnings Call dated May. 07, 2025
Corporate Participants:
Vartarajan Shivak Sankaran
Vikas Kaushal — Chairman of the Board, Managing Director
Analysts:
Vivekananda — Analyst
Nitin Tewari — Analyst
Sabri Hazarika — Analyst
Sumit Rohra — Analyst
Achal Shah — Analyst
Kirtan Mehta — Analyst
R S Ramesh — Analyst
Mayank Maheshwari — Analyst
Amit Murarka — Analyst
ikash Sen — Analyst
Akash Mehta — Analyst
Yogesh Patel — Analyst
Manikanan — Analyst
Presentation:
Operator
It. Ladies and gentlemen, Good day and welcome to the Q4 and FY25 earnings conference call of Hindustan Petroleum Corporation Limited hosted by Antique Stockbroking Limited. As a reminder, all participant lines will be in the listen only mode. And there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call. Please signal an operator by pressing the Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Vartarajan Shivak Sankaran from Antique Stockbroking. Thank you. And over to you, sir.
Vartarajan Shivak Sankaran
Thank you, Steve. Very good morning to everyone. It’s my pleasure to welcome all the participants to this fourth quarter HVCL results call. I would like to extend a special welcome to the Chairman. Managing Director, Mr. Vikas Kaushal. Mr. Rajmish Naran, Director, Finance. Mr. S. Burton, Director, Refineries. And Mr. K. Vinod, Executive Director, Corporate Finance. I also take the liberty of representing the investing community in extending a special welcome. As well as extending your best wishes for a successful stint at HCL to Mr. Kaushal. I would like to hand over the call to Mr. Kaushal for his opening debark and then we can move on to Q and A. The floor is yours.
Vikas Kaushal — Chairman of the Board, Managing Director
Thank you. Thank you and good morning everybody. Thanks for joining the call. It’s my first time I’m speaking to you in my role as HPCL’s chairman and managing Director. As you might be aware, I joined mid March and it’s been an exciting time working with my great colleagues here. Just to start off with, we all know HPCL has worked hard to create a strong business with a great momentum. And it’s my privilege to work with the team HPCL to take this business forward. As is the pattern on this call, we’ll start with some opening comments which I will share on behalf of my team and then open it up for questions. We published our annual results yesterday. The Board of Directors approved it and we released it to you all and the media and the stock markets. As you are aware by now, HPCL had a strong quarter four with an 18% increase in Q4 PAT on a year on year basis. The numbers speak for themselves. But behind these numbers is a strong physical performance. And let me first talk of that because the numbers are outcomes of these performances. HBCL achieved a record performance in refining throughput last year. 25.27 million tonnes.
I’ll start off with the Vizag refinery. It has a throughput of about 15.3 MT, thus capturing the volume benefits of VMRP. Those of you who have been following us for a long time recognize that we took the volume increase in Vizag and took it to about 15mt. And we have now realized the full volume benefits. We’ll talk of the ongoing projects in the second half of this opening statement. Mumbai refinery also almost touched 10 million. We ran a few thousands below that or a few hundreds below that. But that gives us a chance for the next year’s goal. But if you just look at our numbers and I wanted to bring out one fact, we have structurally altered the refinery throughput. Just looking at the last two years, in the first quarter FY24, we had a throughput of 5.4 milligrams.
This was 6.74 in Q4 of 25. Just do the math behind it, it represents close to 24.8% to be precise. Increase in the throughput. That’s the structural change we have made in the last eight quarters and which places us well in terms of balancing our production and sales. Talking of sales, let me quickly move to the marketing side. Our Marketing volumes for FY25 were a record number 49.82 MT. Just marginally short of 50 which we were hoping to touch internally. But again you need to leave some goals for the next time. Also on the domestic front, our market sales grew by 5.5% outperforming the industry growth at 4.2%. We registered a market share of point gain of 0.25% amongst our peers, almost all of our business units in marketing achieved record volume numbers last year. I will not go into the specific details here, but just wanted to inform you all that we continue to expand our customer base, our retail network and even our direct sales business and some of our B2B sales business quickly pivoting onto the third part of our business pipelines. We achieved the highest ever pipeline throughput or 26.9 Mt which again allows us to save a lot on transportation costs. I’m sure you all want to know about the projects. We have been making significant progress on our projects. In February 2025 we commissioned our state of the art 5mtpa terminal at Chara. We have started gas supplies initially through spot cargoes and and those of you who have been catching on news would know in April we signed our first major midterm gas deal and this bodes towards a strengthen we want to strengthen our gas our play in the gas business. You will see more action on that in the coming months. Another significant project which is very close to commissioning is the LPG Cavern in Mangalore. Those of you who have had a chance to know more about the project will realize it’s one of the marquee projects which is being done underground Cavern for storing lpg. It’s a fascinating asset. I would say it’s a great national asset which is being done and it’s a testimony to HPCL’s project capabilities. We have completed the Cavern and now we are in the process of stitching up the compression units etc. And this could go into commissioning very shortly. Talking of other projects which I’m sure are of interest to all of you, we do a lot of other small projects in interest of time. I’ll not go on to those details but many of them are inching towards progress and starting to give results on the two big projects which are open vmrp, the bottom upgradation or the rough as we call it. We have started pre commissioning activities very recently. We got the peso approval for commissioning which is one major step in that direction. Both these approvals, the SS stitching up, the tying up of the loose ends, etc. Start happening. We expect feed in as we call it to the unit in quarter two on hrrl. The project is progressing steadily. We are starting to gradually bring out bring units on stream. Just last month we got a couple of parts of the old complex on stream and we expect to cut crude in this refinery in this calendar year. So that was on the project progress. Let me quickly come to the financials. You might have all seen it in the results we achieved the PAT of 7365. But if you look at our whole year’s journey, in the first two quarters HPCL had a path of 987 or under 1000 crores. Since then it has been a very strong upward trajectory with quarter three at 3023 crores and quarter four at 3355 crores. On an average in last quarter we have been earning over 1100 crores a month as pat, which obviously bodes well. Our run rate on that is quite good and bodes well for our momentum. The board of directors has recommended a dividend of 10.5 rupees per share. Before I close, let me just talk briefly about our future and then we’ll open up for our questions. We are entering a very exciting phase of our journey. Our large, long drawn and dare I say challenging CAPEX cycle is coming to an end and this would start impacting our financial positively. I gave some timelines on some of the important projects. Once our current wave of projects is over, we would be embarking on the next wave of our growth journey. But for the time being our focus is to make sure we are starting to get the returns from this capex. Before I close, I wanted to thank you all for your coverage and interest in hvcl. The management team looks at the future very excitedly and they look forward to continued engagement with hc. You all, I wanted to thank you all for participating in the call and the floor is open for the questions.
Vartarajan Shivak Sankaran
Moderator Hadi
Operator
Yes sir. Okay, thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your touchstone telephone. If you wish to withdraw yourself from the question queue, you may press star and two participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
The first question is from the line of Vivekananda from Ambit Capital. Please go ahead.
Questions and Answers:
Vivekananda
Yeah, thank you very much for the opportunity. Congrats on a great set of numbers. My first question is on the APEC outflow. You have done 145 billion of the 770 billion capex target from FY24 to FY28. What are you budgeting for FY26 and 27? That’s question one. Secondly there are some disclosures that I would like on the financial front. What is the leverage position at HMEL HRRL and also if you could share the crude processing grm, EBITDA and PAT of hme. Thank you.
Vikas Kaushal
Yeah. During the current year the capex was around 14,500 crores. The current year again would be in the range of 13 to 14,000 crores because that this would primarily be the completion of the project which we are already being undertaken and definitely the next phase would. The next phase of CAPEX would be after we consolidate the current projects which are getting completed and as rightly said by our chairman that we will be embarking on a fresh wave of investment after that to fulfill the total planned capital outlay which we have planned.
Now coming to the performance of HMEL, the HMEL if you see the GRMs were around 9.$3 per barrel and the debt level is around 35,000 crore or if I say net of cash is around 33,000 crore over there as regard HRL is concerned the current debt is around 35,000 crore but the project is still under progress and the total debt tie up authentication which we have done is around 48,000 crores but that is yet to be available. The balance amount sir, just a couple of follow ups on hmel.
Vivekananda
What was the EBITDA impact for the full year and was the GRM that you mentioned for this quarter or for the full year?
Vikas Kaushal
Full year the Q4 was more than $12 a barrel. Okay, could you answer my question on the EBITDA
Vivekananda
And pat please?
Vikas Kaushal
At the PAT level it was negative and that is primarily because of the depressed prices on the PetsChem front. But at the EBITDA level it was around, it was more than 4000 crores.
Vivekananda
Okay, thank you very much.
Operator
Thank you. The next question is on the line of Nitin Tewari from Philip Capital. Please go ahead.
Nitin Tewari
Good morning sir. Thanks for the opportunity. So my first question would be on on Barber refinery. So as you mentioned that we are looking for in this year so roughly what is the IUPM when we are looking to commission the refinery fully and if you can give us some incremental color about by when we can expect some stabilization and introduction of products from barmy refinery in the market and also if you can like you know make us help us understand what kind of refinery margins or operating cash flow we are expecting from the refinery when the refinery stabilizes on an ongoing basis. So that would be my first one.
Vikas Kaushal
Yeah. So the refinery construction is nearing completion. Some of the utilities, key utilities required for commissioning have been commissioned like compressed air, cooling water etc. The crude distillation unit will be taking in crude Most probably by the 1st of October for the along with the crude distillation unit we will also be commissioning the hydro treaters so that Ms. And HSD production will start along with the crude destination. So this all will take in phase wise starting from October 1st. With respect to your other questions like how the financials will look like it will be more or less in line with the other refineries depending on the market conditions and once we start the Petcom unit then we’ll get the full intended benefits.
Nitin Tewari
So what is the timeline for Petcom Union?
Vikas Kaushal
Fedcom Union will start from yearly next year from January 1st.
Nitin Tewari
So I mean that’s, that’s what my question was that once refineries fully commissioned stabilized. So I mean what kind of like you know margins can be from the refinery.
Vikas Kaushal
See if after the full, if HRL is operating at full capacity the refinery and the PET Chem the evaluation which has been done is around $20 a barrel grm. So that would be what the refinery is capable of. It has a very high PET Chem intensity and capability to upgrade the product. There is no bottoms over there at all only whatever come out will be only gasoline and diesel and the pet catal.
Nitin Tewari
So this 20 that we’re talking about is keeping the current margin environment in perspective or these are
Vikas Kaushal
Mid cycle GRMs which have been considered.
Nitin Tewari
Understood sir. And sir, my second question was with respect to our diesel sales there is a slowdown which is being observed in diesel sales in the fourth quarter as well as on an annual basis. The growth was just about. As far as diesel consumption or diesel sales are concerned. So any particular reason for that? That why the sale of diesel is rather stipid?
Vartarajan Shivak Sankaran
I think just let me attempt the question and answer and you can add the specific numbers if required. See, year on year comparisons often get fraught because you recall quarter four of last year was leading towards the elections which obviously increases the movement activity. So quarter on quarter comparisons sometimes get clouded by these kind of things. This year there was no eviction hence there was no spike in the diesel thing. So that’s one. Our diesel sales have continued to grow and we can give you the specific details if you are interested in those numbers.
But till now we have not had a challenge on evacuation of of diesel as yet. Of course when new refineries come in we would expect and hope that the demand picks up from the current levels further
Nitin Tewari
Understood, sir. I mean I was coming more from the perspective that overall, I mean sales of diesel in the industry itself, I mean in this quarter has been on the slowers. If we look at the data which is coming out of APAC was a 1% growth on a Y OI basis in this quarter. So any particular reason that why there is such a tepid growth in diesel sales?
Vartarajan Shivak Sankaran
There are structural changes which keep on happening over a period of time. So if you look at electrification of railways has impacted demand segment. Similarly if you look at even vehicular segments over a period of time we have started going more towards especially the larger ones, the passenger vehicle. Whereas a few years ago the demand because of the price differentials was much higher on the diesel side. So there are a lot of structural, I would say reasons behind this. In a large industry, a large consumption market like this come out over a period of time.
We are quite aware that EPIC has lower forecast for growth on diesel as compared to some of the other products and I’m sure all of us in the industry are working our strategies around it. Yes, you are right that the regard to growth in HSD has been muted but in terms of HPCL performance, HPCL performance has been far better than the peers. We had grown by 2.2% against the 0.3% of the entire the retail industry is concerned.
Nitin Tewari
Understood sir. I’ll get back in the view for more questions and thanks for answering my queries.
Operator
Thank you. The next question is from the. Of Sabri Hazarika from MK Global Financial Services. Please go ahead.
Sabri Hazarika
Yeah, good morning and congratulations on good set of numbers. So I have two sets of questions. Firstly that you have given some guidance with respect to the profitability run rate maybe like 1100 crore per month. So if we assume around 1314 thousand crore of say normalized profit for the company, another 6000 crore of depreciation. So. So somehow we are at a free cash flow generation territory and given the fact that our debt is still elevated compared to say some of the peers at say 56,57,000 crore standalone I’m talking about. So do you have a debt reduction target in mind in terms of absolute numbers or do you think that the EBITDA itself will go up? So debt to EBITDA could be like a better metrics.
Vikas Kaushal
So I think two parts to it. One, I want to be very clear. 1100 I talked was the past run rate. It’s not a guidance from our side. We as an organization do not give guidances. Of course you guys are free to draw your conjectures. 1100 is just 3355 divided by 3. So that was the run rate we have achieved in the recent past. Now extrapolating the run rate like you have done, yes we would be in a cash generation thing which should come in because as I said earlier we are ending a large capex cycle and that should throw us results. We have already achieved some reduction in the debt equity and I request Director Finance to probably give some more details on the numbers.
Vartarajan Shivak Sankaran
If you see on a standalone basis last year our debt equity was 1.4 something and the current year we have ended at 1.38. Now we are expecting that the internal generation would be good enough and we would be able to if not add any debt to it. But definitely the network part would be increasing and you will see a reduction as regard the debt equity is concerned. So next year we may end the debt equity between 1 to 1.11 to 1.1. Thanks. And and second set of short term and long term. But if you look at long term it would be significantly lower. It could be around 0.7.
Sabri Hazarika
Yeah. Anyways like Q4 also has that excise duty adjustment, right? So that is also there in Q4.
Vikas Kaushal
I have not done that right now what numbers I’ve given is gloss up upon that. Right?
Sabri Hazarika
And second question is on Barme refinery. So, so, so we you’ve given that $20 guidance. Given that it’s a very complex refinery with significant pet chem intensity this $20. GRM could basically translate into what kind of ballpark? EBITDA, it’s 9,000 Korea. And whether that is enough to cover for the interest depreciation, or we would be at a maybe not at a very high. High roe at least in the initial years.
Vikas Kaushal
Yeah, yeah. What numbers you are getting it would be around those, those numbers and it would cover the interest and other obligations.
Sabri Hazarika
But do you need to like infuse more funds there in terms of like cutting down the debt a bit or something? Even now I think the debt is quite not as high against a 60,000 crore. I think in Capex your debt you have mentioned 33,000 crore so that’s like less than 70, 30. But do you see that there could be like fund requirement to like reduce debt in case we are at say 7,8,000 crore of EBITDA only
Vikas Kaushal
Right now the committed project cost is around 73,000 crore. So I don’t think the debt would be lesser. But yes, what we will make out is out of the revenue generation from this facility, from this project is what will be used for bringing down the debt in the near future.
Vartarajan Shivak Sankaran
And as you rightly said, these are very complex assets. This will be the most complex greenfield done in India from a scratch or from breaking ground to getting it fully ready. It will take some months and all.
Operator
Sorry to interrupt, the line for the management has been disconnected. Please hold while we reconnect them back it.
Ladies and gentlemen, the line for the management has been reconnected. Yes sir, please go ahead. Yes, I was just. When we got disconnected I was saying these are complex assets to bring up the stream. They are great engineering challenges which of course we have a great team which can get on top of all of these.
Vikas Kaushal
It will take a few months to stabilize, maybe quarter or two or whatever time it takes and as a management team we are fully geared up for that. If it needs some short term support in stabilizing the unit in terms of financials also, that’s quite okay. We are creating an asset for a long time.
Sabri Hazarika
Thank you so much for the clarification and wish you all the best.
Vikas Kaushal
Thank you.
Operator
The next question is from the line of Sumit Rohra from Smart Sun Capital. Please go ahead.
Sumit Rohra
Yeah, hi sir, I’m in A very good morning chairman sir to you and welcome to your first call and good morning team hvcl. Sir, you have done a commendable performance in a very challenging environment. You’ve reported actually 7,300 crore of profit after absorbing 10,000 crore which is truly commendable. And you’ve actually surpassed your FY24 profit. So it’s actually heartening to see such a strong core performance by you and your team. So I have a few questions. So firstly on the LPG part, I mean what is, you know, your thought, you know, on the LPG under recoveries and what’s the way forward? Because you know today I mean you’re under recoveries are already at ten and a half thousand. So any thought on, you know, on the compensation aspect from the government and when do you expect to receive anything on that? My second question sir is basically you know, on the demodul of the lubricant. Because today sir, I mean the matter of fact is that HCL’s market cap truly doesn’t reflect its true intrinsic value because it’s at about $10 billion. And $10 billion is just the cost to set up one refinery in India today. But whereas HCCL giant is available at this market cap.
So sir, any thought on value unlocking on the lubricant part? Because today our nearest competitor Castrol, who’s one third our size has got a market cap of about 25,000. You know there can be huge value unlocking for us on the lubricant part. Sir, my third question would be on the VIZAG residue upgradation project. So if I heard you correctly, sir, you said that that should basically start maybe in the next quarter. So is my understanding correct that you know, you get about a three to four dollar benefit, you know, on the, on the GRMs for the whole refinery, sir?
Vikas Kaushal
Sure. I think you want to take the first question on. Yeah, yeah. The incremental GRM would be because of the low value product will get upgraded to higher distillates. So that additional GRM of 2 to $3 would be accruing to HPC. Now coming to your LPG under recovery. Yes, we had absorbed almost 10,900 crores of LPG under recovery. But subsequent to that, you. You have seen that the government has increased the prices of LPG by rupees 50. The RSP was increased by rupees 50. That would bring down and currently. There is an under recovery of around 65 to 170 rupees per cylinder. The government had also in the press briefing stated that the excise duty which has been increased on the motor fuels would be used for payment of the LPD under recovery. So let us wait how it develops over a period of time and in the current year the mechanism, I’m sure some mechanism would be made out as to how to compensate the oil market itself. Coming to your value unlocking? Yes, we are pursuing, actively pursuing the same with the government. And as and when we get the approval, definitely we will have a look at it.
Sumit Rohra
Sure sir. Thank you so much.
Operator
Thank you. The next question is from the line of Achal Shah from Ambit Capital. Please go ahead.
Achal Shah
Hi sir. Am I audible? Yes. So just wanted to confirm. So what is the proportion in LPG sales from domestic versus commercial? And a follow up question is we understand this 170rupees under recovery is in case of a domestic cylinder. Am I correct on this? And if I’m correct, what will be the under or over recovery in case of a commercial cylinder?
Vartarajan Shivak Sankaran
Do you have the ratios of the 90% is domestic? Yeah. So 90% of LPG roughly is domestic. Yes. The under recovery is on domestic cylinders. On the commercial as you can, a lot of it is B2B sales. So I won’t say that there is a set pattern of over recovery or those things. They will vary from deal to deal. But obviously we are selling them with margins and whatever. It’s a typical marketing thing. Wherever we can get the right margins we will do the deal. So there isn’t a set pattern that X percentage over recovery on commercial. All I would say is that 10% which is sold to commercial or non domestic as we call it is like any other B2B sale where when we are selling we are protecting our margins or building our margins and of course wherever required doing the marketing techniques like discounting etc to catch customers. So that’s a commercial business.
Achal Shah
Got it sir. Thank you.
Operator
Thank you. The next question is from the line of Kirtan Mehta from Baroda pnp. Please go ahead.
Kirtan Mehta
Thank you sir. For the opportunity in case of hnel refinery to earn the cost of capital, what is the improvement in petrochemical spread is needed? That’s the first question. The second question was about the Barmer refinery in our guidance or mid cycle margin of 20 diamonds. What is the crude discount that we are building on Barmer crude and what is the quantum of Palmer crude that we are including?
Vikas Kaushal
Barber crude will be about 20% of the overall diet. And what’s the how much improvement in Pet Chem is required for when we did the financial. These were all done in 2017 period. So when $200 over NAFTA, right? Correct. When it is as already explained during the earlier answer, when the financials are built, it was built based on the actual existed at that point of time. So when the cycle upturns you will get the full benefits. Till then you will get whatever the market price is there. You will realize that for the plant this year was a gradual build up on the Pet Chem operating performance.
So if I look at the run rate which they have towards the end of the year, you know the technical things of getting losses down and all those things, they have to go through that cycle. But the operating performance at the end of the year is significantly different from beginning part of the year which says that operationally we are able to extract almost close to what is feasible from that refinery Petcamp complex. The prices are market determined and all Petchem players right now are challenged in terms of market prices. And we also have to sort of face that challenge on Q4. Then can you indicate the EBITDA run rate for the Q4 as well as the gross margin that we earned on the petrochemical? The EBITDA is for the entire both Petchem and Japan is around 1800 crore.
Kirtan Mehta
1800 crore in Q4, right. And on the farmer crude also you indicated 20% is the quantum of this. What is the discount that we are assuming to the benchmark in our guidance for $20?
Vartarajan Shivak Sankaran
Those are commercial terms, it cannot be disclosing. But yes, definitely there is a discount.
Kirtan Mehta
Sure sir. Thank you.
Operator
Thank you. The next question is from the line of R S Ramesh from Nirmal Bank. Please go ahead.
R S Ramesh
Thank you. And congratulations to Mr. Kaushal. Welcome sir. So if you look at your guidance of $20 a barrel for the Rajasthan Financial. Petrochemicals if you had to just take the refinery part, how much would be the margin we gave you the integrated one, the the separate. We will do it and we’ll share it separately.
Operator
Yeah. Secondly if you look at your gas business can you share the details of your standalone CGD gas in terms of how many gas are operational, what are the number of CNG stations you have added and the cumulative number of CNG stations and what the plan going forward in terms of ramp up in the operations there and some indication of when you will be able to achieve addition to your EBITDA from the CGD business.
Vikas Kaushal
If you see the gas business we are doing more than 1 million metric ton of sales there both in CDD as well as in our gas business. Put together in terms of number of CNG stations in our GA they are more than 600 outlets which we are having in our GS. And in terms of total numbers the total CNG stations in HPCL outlets is around 2100 outlets.
R S Ramesh
So you look at the outlook for 2627 your standalone gas, how many gas do you expect to be profitable? What would be the volume you can achieve say over the next two years and some integration of the unit EBITDA or the profitability you expect?
Vikas Kaushal
Currently the VA which HPCL is operating under HPCL is the Ginsonipat and we have in UP and this all are profitable for us right now. And in terms of volume we expect 20 to 25% decrement in growth as regard volumes is concerned rather last year we got around 40% but minimum would be 25 to 30% growth.
R S Ramesh
And finally in terms of the capex numbers how much would you have spent in CGD25 and what is it we are spending around 11 to.
Vikas Kaushal
Sorry 1000 to 1100 crores we are spending and that trend would continue.
R S Ramesh
Okay, thank you very much. I’ll join the team.
Vikas Kaushal
Thank you.
Operator
The next question is from the line of Mayank Maheshwari from Morgan Stanley. Please go ahead.
Mayank Maheshwari
Hi sir, thank you for doing the call. The first question was related to marketing. Can you just talk a bit about the strategy on marketing considering you are seeing private players getting more aggressive and you’re bringing in a reasonable amount of transport fuel in the market over the next six to nine months from your own production or from the refineries. So can you just talk to us about how the competition intensity looks like for you? How. Why are you trying to kind of manage that from a strategic perspective over the next few years? Thank you. That’s my first question.
Vikas Kaushal
You want to ask the second one also or you want to go step by step? Okay, let me answer that first. So I think as you would have seen over the last few years, HBCL has expanded the foothold in marketing both in terms of volumes, the footprint and our market share. Some of that is in anticipation and preparation of our expected volumes which are going to come in the foreseeable future. We continue to look at two, three levers we are using in marketing. On the retail side, network expansion continues with. Wherever we think we are going to get additional volumes, we are continuing to do the network expansion.
Second, we are focused a lot more now on increasing throughput through our existing retail outlets through, you can say micro marketing through very targeted efforts through improvement of our retail outlets. That’s the second key thing which we are aiming. This would give us an uplift on the volumes from our existing and expanded retail network. We also have detailed evacuation plans on when Barmyer comes in, where are we going to do the product, how is it going to move, etc. And we do think Barmy, which comes up initially and that of course is a landlocked refinery. But we are very well placed with the pipeline connectivity and if you studied that project, you will recall most of the liquid product actually gets evacuated through pipeline, which gives us good competitive advantage in the catchment area. We are going to target.
Of course more diesel would come up through Vizag post rough commissioning. Vizac of course has the flexibility of doing coastal movements and targeting markets. So there are plans around all of those efforts. In addition to our retail footprint, we have also expanded our bulk sales business not only on liquid fuel but also other products. And they achieved retail. They achieved record numbers last year. And we are further pushing on bulk sales and you can say B2B sales across all our products. And one of the other things is just to add, to balance out our requirement, we always have the option of purchasing less from outside, which we were totally dependent on in the past because you would have recalled that our numbers are slowly sort of catching up. The refining, the gap between refining and selling of the products is reducing and we Marketing of the expanded fuels.
Mayank Maheshwari
So just an extension to that. Can you just talk us about on the industrial fuel, how the margins have moved in all overall bulk, whether it is on the fuel oil, sulfur, whether it is diesel, all put together. Can you just talk through of how the margins have kind of shaped up for fiscal 25 versus the pre Covid levels?
Vikas Kaushal
Yeah, I’ll let my colleagues answer on the pre Covid levels. I won’t know that far on the whole, I think since this is a B2B business, this runs differently from retail in the sense in retail we have normative margins. And then how close to the normative margins can you get there? Here every deal could potentially have different margins. These are competitive deals. There are at times when you get low margins or you have to pick business or volumes at lower margins. At the same time, if we are able to in some cases bundle the services which we are increasingly doing for our customers on an aggregate basis, we are able to get more margins or more returns for us. So it’s a complicated business. Very hard to give a generic assessment on whether the margins are up or down because this is the real, you can say closest to the. I would say trading is the wrong word to use, but it’s as close to a commercial market as anything else could be.
Vartarajan Shivak Sankaran
Yeah, Mike, if you look at those margins, yes, during COVID time the margins had gone up a bit. But subsequent to that the margins as regard the INP products or the diesel and all is concerned, they are all mid cycle margins which we have been getting. And even currently, if you see for a change, the FO is positive now. Yeah, that’s true.
Mayank Maheshwari
Okay, that’s fair. And I think the second question, I think this was directly to the chairman itself. Like when you think about over the last month that you have kind of looked at HPCL now, how do you think about managing the objectives of the majority shareholder and how do you see that kind of panning out in terms of where HPCL would look like in the next five years?
Vartarajan Shivak Sankaran
I think the majority shareholder, of course there are national objectives. As a national oil company, we have to meet. But my majority shareholder does not ask me to run the business differently from if I was running it in a private sector. The business is run for efficiency, run for growth, run for improvement. That’s how it’s been done in the past. That’s what has been my message to the team here. We are going to run business for growth. We are going to run the business for efficiency, improvement, et cetera. Yes, there are national objectives, which have to be. Met at timescale and there are some constraints we operate in but beyond the constraints it would be business will run like any other business. And I view this as something with great potential. Now we in our case have two roles to play. One of course as a common entity and then second our association with ongc. Well, both of our organizations are working on what synergies we could draw from each other and these are complicated topics to work on. But we are hopeful that some of the synergies or we will increasingly capture the synergies which is benefit for both the organizations. So actions happening on those fronts also as you can imagine and appreciate, these are long drawn things. Not never easy, but we are moving on those fronts. But to step back, I think this is a fantastic business we have. Our teams over the years have created a great thing and you commented on the fact that I’ve been here a month and a half now. I was always in awe of the technical and marketing powers HPCL had and now being in my chair, I’m super thrilled with the technical and marketing powers we have. I can say our refinery teams are second to none in this business. We have an extremely talented and competent team which if you go through the details of what has been created over the years tells you the wonders which have been done. How a small refinery in Mumbai is where it is right now, close to 10 MTA. How wise. Like if you ever visit, you’re onto our fourth crude distillation unit. Over the years it has been brought to 15 million tons and with the increase so that requires technical power. Similarly, if you look at marketing, we have been creating record volumes every year which means our field force are doing something well. Do we have improvement opportunities? Absolutely. That’s the reason I’m here collectively with the team. We are all working and capturing the improvement opportunities. And I’m sure in the subsequent calls and in other occasions we will have chances to meet, you will see and we will also unveil some of our plans on what we are doing to make this business fundamentally and structurally even more efficient than what it is right now so that we can we grow and our shareholders, whether government or the large entities which hold our share or individuals hold our share, large shareholding, they all benefit. That’s how I look at the situation. My reflections on one and a half months and thank you for asking that question.
Mayank Maheshwari
Thank you and best of luck and congratulations on your. Thank you.
Operator
The next question is on the line of Amit Murarka from Access Capital. Please go ahead.
Amit Murarka
Yeah, hi. Thanks for the opportunity. So sorry you joined the call a bit late. We just wanted to check if you’ve already shared the numbers. On refining and marketing inventory.
Vikas Kaushal
Could you be a bit louder? We could not hear your voice please.
Amit Murarka
I was asking have you given the number of refining inventory gains and marketing inventory gains losses in the quarter and full year? If you could share that one please.
Vikas Kaushal
Refinery in the Q4 the inventory gain was around 600 crores and the full year there was a loss of around 550 crores. Okay. And for marketing? Marketing it was again in Q4 550 crores gained and around 900 crores loss for the full year.
Amit Murarka
Sure. And also in terms of the capex you mentioned 14 to 15,000 crores. Could you kind of break it up as well between the various sub segments including equity investments into Rajasthan refinery
Vikas Kaushal
The equity investment would be around 4000 crores. The investment in refinery would be 9000 crore and balance would be
Amit Murarka
Sure. And lastly, what’s the update on the China terminal?
Vikas Kaushal
Terminal has been commissioned already and we have already got around four parcels over there. And one more update which our chairman also in his speech stated that we have also to sign that midterm deal with one of the suppliers for a long term gap. If you have customers who want natural gas, refer them to us. We are actively selling natural gas LNG or regasified LNG from Chara terminal. We are already February onwards. You’re already into that business?
Amit Murarka
Sure. It’s fully commissioned and nothing is pending and just waiting for more contracts.
Vikas Kaushal
Yeah, yeah. Only the breakwater is under construction which will get completed in the spare weather season out of 1900 square meters. Around 1300 square meter is already completed. The balance would be completed.
Amit Murarka
Correct. And lastly on the vice find the upgradation like how much benefit you would have received in Q4 from that.
Vikas Kaushal
We have got the incremental volume that that’s almost 2 million metric ton of additional volume per quarter what is accruing to hpcl. The more benefit would come once the residue augmentation unit will get commissioned which is likely to happen in this Q2 of the current financial year.
Amit Murarka
Okay, that’s all. Thank you.
Vikas Kaushal
Two to $3 per barrel for the increased distillate which is rough unit is going to churn out.
Amit Murarka
Sure, Got it. Thank you very much.
Operator
Thank you. The next question is from the line of Vikash Sen from clsa. Please go ahead.
ikash Sen
Thanks for taking my questions. I’ll have a couple of small micro questions and then maybe a more bigger strategy question. Since this is the first time you’re speaking to Mr. Kaushal. Firstly, on the 4Q of numbers, the annual forex change number that you’ve given implies that 4Q had a forex gain of about 75 crores. Is that correct? Because that’s a bit odd given that rupee had actually end of period, rupee had depreciated. So is that the correct number that there is a forex gain of 75 crores or is there any adjustment over there?
Vikas Kaushal
No. In Q4 we had a forest case. You are right.
ikash Sen
Okay. And there’s no real adjustment or anything like that? Oh no.
Vikas Kaushal
No adjustment.
ikash Sen
Okay.
Vikas Kaushal
You would have seen that we had depreciated. But in the last month, especially in March, all of a sudden it appreciated significantly.
ikash Sen
Sure. Thanks Mr. So just one more thing. Since we discussed about the Rajasthan refinery and you said that $20 a barrel is how we should think about the integrated margin. Since this is not a normal pure refinery OPEX would also not be as low as 2, $3. You’re talking of refinery plus petrochemicals. So where should we be imagining the OPEX to be? Is it like more like 6, $7 kind of range including everything? Since you’re talking of $20, the competitive Opex number should be how much?
Vikas Kaushal
Yeah, it would be around five to seven dollars. Between that.
ikash Sen
Okay. Okay. And so 73,000 crores is the planned project cost. I believe we are on track on that one. Not real big deviation on that. So if that is the cost, about 5% should be the depreciation on that. Is that roughly broadly how it should be? Right?
Vikas Kaushal
Yeah.
ikash Sen
And at peak when all is spent you would go up till 48,000 crore kind of debt. And roughly 9 to 10% will be the cost of that debt, right? Slightly lower. Okay, sure. Thank you. That’s all very useful number numerical answers. Just one more on the strategy thing. Since we have the new CMD with us. You did mention that once there is consolidation after these projects come in then we will look at the next next leg of growth for hpcl. Now how should we think of when the company will start believing that consolidation will be over? What is the key metric to watch out for over there, would it be. Looking at debt to equity falling to say below around 50, 60% or some kind of net debt to EBITDA number, that’s one. And secondly, once that is over, since we will be getting. By the time the next set of expansions get planned and they come in, we will most likely start getting into the next decade, how would we be thinking about what is the next leg of growth? Since there is also this talk of perhaps some kind of peak demand or we already have surplus capacity in India in terms of refining, etc. Would a lot of that be focused on petrochemicals or is it. A lot of it will be also thinking through new energy. How? I mean, of course a lot of this is going to be more guidances at this point of time and as the world changes and we update ourselves, this might change. But sitting right now, how do you see these things kind of moving ahead?
Vikas Kaushal
So let me take that question to pass to your question. What would be the metrics? Well, we have not fixated those matrices right now and as director of Finance mentioned earlier, we are continuing to do capex even right now. It’s not that we have stopped. Yes, we are very prudent in what we are doing right now given our overhang of the previous projects in terms of huge capital expenditure which is coming to fruition right now. So we are very prudent right now. But we gave some numbers on citigas, how much we are expanding, we are putting it up other areas also. So there is a continuous capital expansion which is happening, but not in form of two huge projects which we had talked off. Now looking at the numbers we have not yet as a management team put a marker which says oh, at this level I’ll open the gates for stream A or stream B. But directionally you are thinking in the right direction that we want to get our debt, equity and serviceability in a level where we are comfortable withstanding all kinds of challenges which dealing in oil industry presents. So at that stage we will probably take a call on those. It also needs a bit.
Operator
Sorry to interrupt, the line for the management has been disconnected. Please wait while we reconnect them. Thank you. Ladies and gentlemen, the line for the management has been reconnected. Yes sir. Please go ahead.
Vikas Kaushal
Sorry. Thank you. Sorry for the disruption the way you all had to do. I was talking on the strategic direction. Well, peak oil, nobody knows what when it is. As many of you know, I’ve been a consultant in this domain in my previous apar and I used to talk a lot about this. My personal view is the peak oil in India is much down the line. It will be the last of the major economies to go to the peak oil. So there is potential in oil also for a foreseeable future. There are other opportunities for growth and not everything we do should come in the next decade because there could be inorganicopportunities we look at.
There could be other lines of businesses. As many of you might be aware, we have a very strong RND also and that could give us new opportunities. So as and when we do come out with our revised growth plan sometime in course of this year, we will take the opportunity in one of the subsequent calls to share the nuggets with you. I can certainly foresee that would be a much more broad based plan as compared to the last five years which there we went heavy on refinery investments because we needed to cover the gap between the product we sell and the product we refine. Now that gap is reasonably well covered for us between our own increased refineries and the joint venture partnerships we have. Now our next five years I would see much more broad based investments including responding to new energies and taking on areas where we think this will be a leader in the market. That’s how I think about it. Beyond that we don’t have any detailed plan. As I said at the beginning of the call, our primary focus right now is to make sure our large capital comes up to stream and our big projects are completed. Big and small. All projects are completed so that we start getting returns from those projects which allows the company to be in a very strong position for a future growth phase.
ikash Sen
Thanks sir. Thanks a lot.
Operator
Thank you. The next question is from the line of Akash Mehta from Canada, HSVC Life. Please go ahead.
Akash Mehta
Just if you could register on numbers. I mean if you could just share the market share for. And diesel for Q4 and for fiscal 25 as well.
Vikas Kaushal
Yeah, I think we are just pulling out the right number. Give us a second. The question was for Q4 but if you have the full year number you can share that.
Vartarajan Shivak Sankaran
I think to my. If I recollect correctly we are having a Market share of 24.76. 24.76% for motor fuel portfolio and all products put together is around 20.5.
Akash Mehta
Okay. And then for Q4 I think that would be okay. Okay, thank you. Yeah, that’s it for myself.
Operator
Thank you. The next question is from the line of Yogesh Patel from Dalad Capital. Please go ahead. T
Yogesh Patel
Hanks for taking my question, sir. The post fully commissioning of bottom up gradation unit at Marzag refinery. How much time it will take to get the full benefits of three to four dollar per barrel into the grf.
Vikas Kaushal
These are huge complicated processes and this technology is a path breaking technology. So we have to give our plants around three months for full stabilization, etc. Now we might reach that faster. It might take a couple of weeks here and there. But as a management team we are very much focused on making sure there is a safe operation. When you run a plant like this and if any of you have visited Vizag, you could understand how complex that rock unit is. It’s a refinery within a refinery as we say. So it will take a few weeks you can say for full stabilization to come in. But we are focused on
Yogesh Patel
Would be fair to assume that $3 $4 per barrel kind of benefits will fully reflect into the FY27.
Vikas Kaushal
Yes, we are very hopeful of even starting to reflect in some of the later quarters of this year. That’s what our internal view is. We will start getting those benefits in the later quarter of this year.
Yogesh Patel
Okay sir, next question. Related to Russian crude process in the Q4FY25 and the current levels of Russian crude is it. Is it improved compared to the Q4 FY25? Yeah. We have been getting about five to six parcels of crude every month.
Vikas Kaushal
This is continuing. There was a dip only in one month in the last quarter. Otherwise it is in terms of a percentage.
Yogesh Patel
If you could share the number you generally share overall as HPCL
Vikas Kaushal
We are at 35% Russian. That was the Q4 FY25 number sir. It was about the full year. Q4 is close to that. 30 to 33%. Okay. And sir, on the HPCL and ADNOB trading they have. You have signed adnob.
Yogesh Patel
You have signed the LNG trading supply contract with the adnob. Can you provide some details on the pricing whether it is linked to the crude or Henry Hub and the quantity of LNG import under this contract it is linked to Henry Hub.
Vikas Kaushal
I don’t think beyond this. I can say anything. Okay. And lastly generally you share the pipeline segment throughputs every quarter and annual basis. Can you provide some revenue and the EBITDA details of the same segment for FR25 and Q4FY25? I can share you the volume. It is 24.9 million. 6.9. 26.9 I said that’s the opening statement and 6.61 million metric ton for the quarter.
Yogesh Patel
So any details on the revenue and the EBITDA side of the pipeline segment? If you could share.
Vikas Kaushal
We are moving our own product only in the pipeline there we we don’t account any revenues for this.
Yogesh Patel
Oh thanks. Thanks a lot sir. This was really helpful. Thank you. T
Operator
He next question is from the line of Manikanan from Franklin Templeton India. Please go ahead.
Manikanan
Yeah. Thank you so much for providing me the opportunity. Hope I’m audible. Yeah. Hi sir. So because it’s an interesting move that you have done from being a consultant to heading hpcl. Just wanted to understand what’s the motivation and upside for you. That’s the first question. Second question. Question is more on hmel. Is it possible for you guys to give me the gross margin that your model is growing if current pricing or spreads are taken into account for Those are the two questions.
Vartarajan Shivak Sankaran
Since this call is about HPCL’s numbers, I will not talk about myself. The only thing I would say is the reason I work here is we have a fantastic opportunity and a fantastic team which can take this place to be. It is already one of the leading companies in India and we will be even more powerful in times to come. That’s my motivation. Beyond that, I think we should just focus on the numbers and I request my colleagues to talk about the HMEL numbers. I can broadly share the beta margin in HMEL for Q4 is around 7%.
Manikanan
Understood. So just to follow up on the first question, can I check on the compensation size and it is in line with the historical changes or there is any change in the content structure in the press?
Vartarajan Shivak Sankaran
You just need to read the press. Yes, it is absolutely in line with what was done historically.
Manikanan
Thank you. Thank you so much. That’s from my side.
Operator
Thank you. Ladies and gentlemen, due to time constraint, this was the last question for today’s conference call. I now hand the conference over to Mr. Vartarajan for closing comments.
Vartarajan Shivak Sankaran
Thank you, Steve. I see 11 people in the queue as of now. Please address it to the management or you can send your questions to me, I can get it addressed. I would like to thank all the participants for taking time out to join this call and the management for addressing all the questions in a very detailed manner. I wish the management all the very best in the next financial year as well. Hope the current momentum continues. Thanks everyone and have a nice day. In case you have any closing comments, please go ahead.
Vikas Kaushal
Thank you for all for participating and listening to our thoughts. Thank you for your interest in hbcl. If you have ideas for us, keep feeding them to us. And on behalf of the management team and our entire team, I would say we are all geared up to making sure the time you spent on reading about this talk is well rewarded in many different ways. So thank you all and look forward to some subsequent conversations. Thank you everyone and have a nice day.
Vartarajan Shivak Sankaran
Thank you. Thank you.
Operator
Thank you on behalf of Antique Stockbroking Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.