HPCL raising $300 million via ECB to fund pipeline expansion

NEW DELHI: State-run refiner and fuel retailer Hindustan Petroleum Corp is in the market to raise a foreign currency loan of $300 million to fund its pipeline expansion plan, K V Rao, its finance chief, said.

The company has a capital spending plan of about Rs 3,500-4,000 crore in 2015-16, Rao said. HPCL's debt has almost halved to Rs 18,000 crore currently as sharply fallen crude prices have shrunk borrowing needs for the working capital.

HPCL on Tuesday reported a quarterly net profit of Rs 1,588 crore, compared with Rs 46 crore a year earlier, driven mainly by higher refining margin and inventory gain. Sales in the April-June quarter declined to Rs 51,720 crore from Rs 59,238 crore.

Higher refining margins, inventory gains, increased refining throughput and domestic sales pushed up profit, said Chairman and Managing Director Nishi Vasudeva. The gross refining margin for HPCL's refineries increased to $8.56 per barrel in the quarter from $2.04 in the year-ago period, largely on account of improved cracks and inventory gains.

The company made an inventory gain of Rs 583 crore, compared with an inventory loss of Rs 831 crore a year earlier. In the year-ago quarter, an uncompensated under-recovery of Rs 495 crore also contributed to lower profit.

Shares in HPCL, valued by the market at Rs 32, 270 crore, have gained nearly 60 percent in the past three months.