Hindustan Petroleum Corporation Limited ($HINDPETRO)

Ladies and gentlemen, good day, and welcome to the Hindustan Petroleum Corporation Limited Q4 FY '26 Earnings Call, hosted by Antique Stock Broking Limited. [Operator Instructions] Please note this conference is being recorded. I now hand the conference over to Mr. Varatharajan Sivasankaran from Antique Stock Broking Limited. Thank you, and over to you, sir.

Thank you, Swapnali. A very good afternoon, everyone. It's my pleasure to welcome all the participants on this call and the top management of HPCL this afternoon for the discussion on the fourth quarter results. From HPCL, we have Mr. Vikas Kaushal, Chairman, Managing Director; Mr. Rajneesh Narang, Director Finance; Mr. S. Bharathan, Director Refineries; and Mr. K Vinod, Executive Director, Corporate Finance. I'll now give the floor to Mr. Vikas Kaushal for his comments.

Thank you, Varatharajan. Good afternoon, everyone. Pleasure speaking to you on this call. As you all know, we declared our Q4 and the annual results, just a short while ago, and we thought this would be the right time to do a call early today itself. We wanted to get you before your writing the first reports and asking questions. We wanted to give you data so that you can write the informed reports. I -- before we start the conversation, I would say, like in the past, all the detailed results, investor presentations are both reported to the stock exchanges and also on our website. So we are not going to make a formal presentation like in the past, but I'll start off by talking for a few minutes about how we see the situation about our numbers, highlighting a few points. And then remaining time we will use for an open question-answer session. So just to get started, we all know that times we live in, the geopolitical uncertainty is all around us going on for a fairly long time. The crude prices have gone high. And more importantly, they are very volatile, sometimes shifting $8 to $10 in a day. Product availability of crude raw material, LPG availability has been challenging with the supply chain disruptions. And ForEx, we all know, has had challenges in terms of rupee depreciation. On top of it being in a business which supplies energy to the millions of homes and millions of vehicles, we get impacted by fears and perception. So in some geographies, someday, people think there is going to be shortage of fuel and then so many people turn up at the pumps, et cetera. So that's been the life we have been living in the last 70-odd days. Our focus as a management team has been in terms of few things, first, really ensuring that the supplies are met. Our teams have worked incredibly hard to make sure whether it's LPG supplies, liquid fuels, all kind of supplies are met. The retail stations are looking LPGs getting home, et cetera. That has taken a lot of effort, but we are very happy that we, along with other companies in the sector have maintained their supplies. Second question which keeps on coming and perception will keep on getting hold, crude is going to run out. I can assure you that we, as a company and other OMCs also have fully secured the crude for a long period of time, and we are -- we do see availability of a crude as an issue. Of course, pricing, we all know has been a challenge there. LPG, there has been a very nice pivot in the country on LPG from a situation where we were very dependent on Gulf on imports and those import sources dried out rather quickly. We've been able to increase domestic production. We have been able to increase alternate sourcing, et cetera. And as we speak, we have a very good forward coverage on the supply availabilities. I can assure you, those of you who are connected with LPG cylinders, your kitchens are not going to go dry. You will get your cylinders in time, of course, you'll have to wait for the 21-day cycle, which is the rule now. This has all required a lot of hard work and -- before I proceed further, it will be remiss on my part to not thank my teams in HPCL who have done incredible work over the last 70 days of this crisis. It bakes a lot of toll to supply the cylinder and keep those pumps working in this situation. Also, I would call out a very good coordination between all the oil companies. We have not let each other down and anybody needs product, we have been helping each other. And also there is a very active guidance and interactions with the Ministry of Petroleum and Natural Gas and other government stakeholders to ensure that there is continuous supplies of the product in the country. All people have worked very hard to solve this. Of course, we hope normalcy comes back very quickly and some of us had some well-deserved rest and some chance to sleep. With that prelude, let me come to what you are rated or waiting for in terms of our views on the results. I'm excited to present the results after every quarter, we have come and talked on this forum, talk to all of you, and many of you have otherwise reached out and we have been very open in giving time and also very open in sharing our views and also listening into your feedback and suggestions. . You will recall by quarter 3, we had clocked INR 12,274 crores as stand-alone profit, this was up 206% from last year. So you know we're on a good trajectory for the year. We carried that strong momentum into January and February also and locked in good numbers in both those months. In March, the crisis hit, obviously, all kind of volatility happened. But -- and we had to take a lot of mitigation measures, both in terms of the physical aspects of the business but also the financial aspect of the business. All I can say is Team HPCL was very strict to react, balancing actions with financial prudence. Now not all of those we will discuss on the call, but I would say every inch of effort was done and every ounce of energy was expected to make sure we are balancing the supplies with also managing financial prudence. It's not just for supplies, we are not letting go of all financial prudent there. You all know that our business has a lag effect in March. We pretty much consumed the Fed price crude, so this mitigated the impact for March. And this, coupled with many other factors have helped us in diverging a strong performance and decent performance in March. That, coupled with the January, February momentum resulted in strong quarter 4 numbers. Our revenue for quarter 4 is INR 1,23,000 crores, if I remember it correctly, 4.5% that was marginally because of the price increase in the -- some of the segments, industrial consumers and also some volume increases. The PAT for the quarter is INR 4,901 crores. It's up if I remember correctly, 46% or something of that number. I don't remember it off hand, but it's a reasonably large number. So part which is exciting is when we look at the year as a whole. Our PAT for the year stand-alone is INR 17,175 crores. This is 233% of the PAT of last year, soft 133%. And the previous best ever HPCL has recorded was INR 14,654 crores or something. So this is 17% higher than the previous best HPCL has ever recorded. The consolidated PAT was INR 18,047 crores, 2 of our refinery investments, HMEL and MRPL contributing strongly, especially in the fourth quarter. We are excited about this performance all through the year. We have been talking to you very transparently about what we are doing and many things we are trying to do into our business. I'll talk on that in a minute, but let me give what these numbers lead to. I think you would recall that many of you have questioned us on our debt equity for a period of time. We have been carrying high debt equity for a period of time. At the end of H1 of FY '25, our debt equity was as high as 1.63. At the end of the financial year, it had dropped to about 1.38. But with this strong performance this year, it has dropped to 0.8, this is well below the guidance we had given to you at 1.1. And then towards the middle of the year, we have divided the guidance to close to 1. So we have managed to successfully deleverage of the last year, and I'll give you the breakups on how we think about it. What has driven this performance, one can say it is Team HPCL, which has delivered this performance. And as a management team, we are very proud of our team, which has delivered this incredible performance. Going into some of the factors and of course, market momentums contribute to it and they were pricing regimes helped in the last quarter. Many of you were part of that analyst meet, we have done, including the one where Honorable Minister spoke about it. So that has contributed. But there are 6 key factors in which the management drove, which have also contributed to the strong results. First, our cost takeout program summary. We all know that we've been talking about that in every analyst call. We had given a guidance of INR 1,000 crores, which we later revised to INR 1,500 crores. The actual achievement for the year was INR 1,591 crores, of which INR 947 crores was onetime and INR 744 crores if I get the math correctly, are recurring. The recurring one has been baked in into our budgets for this year, and onetime ones are interesting because it shows a sign of hunger that we are supporting those opportunities and grabbing those opportunities to improve the financial performance. The second key aspect was actually translating the savings into P&L. Sometimes we do this large program show savings, but it does not show in the numbers. In our case, you can very well see in the numbers, and I'll just give you 2 take-up points, First, if you look at OpEx as turnover, in FY '25, we were at 1.54%. In FY '26, we have come down to 1.55%. It's 0.9% which on the base on which we operate is a phenomenal number to get in a year. We might have got even better except for that March, a lot of extra costs had to be incurred for last-minute movements, et cetera. If we just talk in terms of OpEx per MT. In FY '25, the number was INR 1,438 per metric tonne, and this has dropped to INR 1,344, that's the hard cash which has been conserved in the business. You can multiply it with a huge volume, and that's where the savings and the uptick on the numbers had come in. Third, we had a very tight control on the CapEx, 3, 4 aspects. First, we obviously had rough and other in full swing. So that CapEx, we were funneling all the CapEx, which was required there. But we have curtailed and phased out a lot of other CapEx. And on the curtailment also, we went very slow on the CapEx in the first 2 to 3 quarters of the year. It's only towards the end of the year. We allowed some of the -- what I would call as discretionary or less important CapEx. This allowed us to carry or lower our debt throughout the year and also be very prudent in where we spend the CapEx. Fourth, very tight management of borrowings March 31, 2025, we were INR 63,323 crores on total debt. This was on stand-alone, not consolidated. March 31, 2026, we have dropped it out to INR 47,599 crores, that's an incredible drop. And there are 2, 3 reasons behind that entire thing. Later on, we can talk about the short-term borrowings, long-term borrowings, which is there. But from my vantage point, very astute working capital management is one of the reasons behind it. If I remember my numbers correctly, we probably shaved off around INR 8,500 crores from our working capital between the last year and to this year-end, that obviously lowers the borrowings. And then as the prices went out, our teams were very sharp in managing the situation, including things like how much credit we have in the market managing to get hold of that and significantly reducing the outstanding credit, et cetera. All the steps which are in management's control were exercised. The fifth element was lower interest. Last year, we carried an interest of INR 3,914 crores into our P&L. That dropped to INR 3,300 -- INR 3,337 crores during the year, literally around INR 600 crores less. This is lower due to 2 outs, one, lower debt burden as we started performing better. We started lowering the debt. And second, we took actions in specific refinancing of debt, lowering some of our -- we managed to lower our ForEx exposure by maybe $250 million, $300 million during that period. All of that helped in tightening the numbers towards then. Last but not the least, a very strong operational performance, refining best ever. Both our refineries put together, produced more than 26 million tonnes, highest ever, 3% growth over last year. And on marketing, it was 51-point-something of sales. You can see it in the investor presentation, again, a 3.3% growth. All I would say is the earlier -- we'd be focused on growth on profitable segments. We did not chase growth at all costs. So our gross numbers might be that lower than what you would see for others, but that was a very conscious call of not chasing volumes but chasing valuable growth. These steps are a culmination of a lot of hard work by the entire team. And over the years, I've seen the team push the boundaries on multiple dimensions. Once again, I'll thank the team for all the effort there. I'm sure there are some updates you would want to know before we throw it open for the progress. Let me preempt some of the questions. You would surely have a question around RUF. We had commissioned RUF on 3rd of Jan. It is progressing in stabilization, but at a slower rate than what we would have anticipated. We did have, I would say, a situation where there was a clogging of catalyst in the vessel. So we had to take a shutdown we started, et cetera. We are learning how to handle that big lease. The unit is now as I speak back on stream and now it is ramping up fully. We are expecting full ramp-up in the next month or 2. And it's already giving smaller benefits to us, but I would expect more incremental benefits to start coming in towards end of this quarter or early part of next quarter. So from a financial perspective, it is not accretive in the numbers. Those of you who run Excel sheets very passionately, you can take that block and say that is going to come over and above the numbers which we have delivered there. I would expect the numbers to kick in quarter 2. On HRRL, you were aware that we were very close to commissioning or getting the project started even scheduled for dedication to the nation on 21st April. Unfortunately, there was a fire on 20th happens in these businesses as we reported to the stock exchanges. There was a vacuum residue leak in the CDU unit, which caused the localized fire. Thankfully, it was brought under control very quickly. And it was very localized. Just for context, it impacts 6 heat exchanger base in the refinery. And last time I was asking where selling me that there are at least 600 to 800 such heat exchangers in the refinery itself. So it's a very small portion when you see on the map, but obviously, it delayed the kickstart of the thing. The good thing is that it is getting back on feed other units are in the commissioning cycle. We actually have produced and sold LPG. In the trial runs of CDU, we have run at least 1 VLCC of crude already and produced intermediates. And hopefully, in this month, we would start producing diesel and MS and CDU will also be back on stream. So we are hoping towards that and aiming towards achieving a COD on the project shortly. Initially, the refinery would operate at around 60% capacity. We are expecting that run in June itself, we have ordered crude resected accordingly. And from quarter 2, we are expecting the refinery section to ramp up fully. And then slowly, we will add petchem anyway, petchem right now under control orders. We have to produce LPG rather than propylene downstream. On Chhara, which was the other third project, we were able to complete -- the port was able to complete 90%, 95% of the breakwater. I think around 1,800 or 1,850 meters of breakwater has been completed. About 100 is left. With this, we expect the permission to run the asset at full capacity for 10.5 to 11 months of the year, barring the peak monsoon season. For running at peak monsoon season, we need to do the remaining 100 meters, which now can only happen early part of next year or early part of the post monsoon cycle. But we are starting to bring in more cargoes. Of course, right now, everything is disrupted with the supply chain. Last update on the project side, 2G Ethanol, which has been growing for some time, we have achieved mechanical completion by 31st March, and we are hoping to start that project in the next 2 to 3 months. It will be a big -- it's a technologically a big challenging project, so we don't expect value attractive from a financial perspective, but nevertheless, it will be an important project to start. Just closing out on the forward-looking views, quarter 1, we expect it to be very tough. You all are aware of the situation, the crudes are very expensive. Product prices are low and everything is quite volatile. As of where we stand, there would be losses in the first quarter, enough of that has -- that has being said in the public domain, I think just yesterday at the seminar under the Minister of Petroleum and Natural Gas also talked about it. And earlier in the week, Honorable Prime Minister also talked about the fact that oil companies have been under stress given the current numbers. The numbers will depend on multiple factors, and we are not going to give any guidance on this because it's just too volatile to give a guidance. As a management team, we are very focused on the controllable aspects, mitigating the impact where we can maintain the supplies and also getting ourselves ready so that we bounce back very quickly when the business environment turns around. What gives us confidence is our balance sheet strength. We are a strong financial year improvement in the balance sheet gives us the headroom to fight the current situation. Even as we manage that, we are steadfast at agenda for the next financial year. We have been talking to you on these things, but I'll very quickly in a minute or 2, just talk about it and then open it up for questions. Samriddhi 2.0, we had said that we will give guidance in the first analyst call. We have held that guidance because in this volatile environment, we find very uncomfortable to pin down a number there. However, we are focused on this the first phase of Samriddhi we had done in-house for this way, we have selected consultant because we are now getting on to hard to achieve a section. But hopefully, in the second analyst call, we'll be giving you a guidance on what we are looking at. But I want to leave everybody with the message that we are going to continue on the cost journey, and once the whole turmoil settles some, we'll get back on to the cost reduction curves again. Second, on digital front, we are making considerable progress, driving towards efficiencies, capturing and the efficiencies and ease of work, lot of panel initiatives are going on, and you would see the leapfrogging of HPCL on this front. I would encourage you to start visiting some of our refurbished retail outlets, and you'll see that slowly we are starting to make a difference. On the refinery side, HRRL on getting on board, getting it stabilized is one of our top most priority and then getting petchem rolled on. And RUF, we need to start getting in the benefits, and we are confident that having gone through the learning curve, we will get to the benefit soon. The next area we want to talk about is trading or buying our products and selling our products, that has been an increased focus for us over the last few quarters. We have diversified our crude buying. We have brought in flexibility. We have brought in a lot of agility. Many of that INR 900 crores savings actually came in from some of these smart moves on trading. So we are gearing up and also gearing up a bit towards product trading there will be times where we have surplus products. Retail, we are already on the part of strengthening our brand. We had launched Budaun last year. It did not give us as much of throughput increase, but it gave us a lot of learning. Having learned from that, we have launched the Budaun 2.0, where we are now learning from what we could not achieve last year, we are aiming to achieve that this year. And in line with our capital cycle coming to an end, we are increasing our focus on renewables and gas and making sure both the investments we have made are paying for themselves and also thinking of the next wave of investments. Also last point, coming to close on this capital cycle, we are starting to think of our next 5-year agenda. Just to conclude, over the last year, we have started aggressively on our transformation journey. We have taken many initiatives. Some have succeeded, some have failed, but we have learned in this. We have demonstrated our capabilities to all hard nose critics like you and the external world, but more importantly to ourselves because the moment we know of our capabilities, we can win for us. The team HPCL has on hunger and desire to win, and we will hope to continue this strong performance. We are on a strong trajectory and confident on delivering to our shareholders even despite all the crisis with us. Thank you for your interest in us. Before I open it to questions, I also want to take this opportunity to thank my fellow Director, Rajneesh ji. Many of you have heard his voice. As some of you might know, is superannuating after a long tenure in HPCL, including many years at the helm of Board of HPCL. Many of you have followed HPCL for a long time, remember, has INR 40,000 crore EBITDA slide. Well, I was joking with him earlier in the day that we have reached INR 34,381 crores as consolidated EBITDA, which is a fitting tribute to his contribution to HPCL. With that, let me thank everybody for their participation, and we will throw it open for questions.

[Operator Instructions] We have the first question from the line of Probal Sen from ICICI Securities.

Congratulations for a very strong set of numbers. I hope I'm audible.

Yes, Probal.

Yes. Sir, just a couple of questions. Firstly, on the supply situation, you did mention that there's no need to sort of -- you are fully secured for a comfortable period of time as of now. Just wondered if possible, can any granularity in terms of which are the sources that we are sort of tapping at this point of time. And from HPCL's perspective, any time period you want to attach to you for how long we are secured? I'm assuming, of course, that the conflict continues to drag on through the first quarter as well, then how are we placed? And what are the geographies we are taking for alternative supply?

Okay. Probal, any other question or?

I have a couple more, sir. Yes, yes. So the other question was, did inventory gains actually help the numbers this quarter? And if so, if it is possible to quantify? And the third question, what was the LPG loss. You've given the net negative buffer. Just wanted to understand the LPG loss that was there in this quarter. Those were my 3 questions.

Thanks, Probal. As always, given the early bird price, this time, we have to send you a nice hamper for that. But on the supplier situation, see, going back to February of 2026, there was no crisis. What would be the crude I would have secured? I would have secured crude for 2 months of running. That's all I would have secured. Of course, we would have had term agreements, and we would buy spots there. So at no point of time -- let me say, barring a few days here and there when markets are there. But for most period of time, we have been having 2 months outlook for crude all the time. So the normal situation which I have had on crude, the challenge has been that in the past, we were relying, say, half on the -- I'm just saying half as a figurative number not to be quoted exactly an Excel sheet, but we were relying half to term contracts and half on spot of late, given the challenge that our contracts were from [indiscernible], it had to rely a lot more on spot cargo. So we have to do our spot purchase a lot more frequently. But at no point of time, except for the first 3, 4 days of the crisis in the first week of March when there was the shock end of what was happening, where we're not covered with roughly 2 months of inventory, which is normally what we carry -- 2 months of secured supply. And right now, we are already in the market starting to lap up cargoes for today and we are getting enough cargoes. So the cost is more expensive. In terms of geographies, well, this was not a time to be either optimizing the crude which you could run in your refinery, and that probably also impacted our GRMs to some extent because in neither situation, we would have run no particular mix of crude. But right now, we were running crudes which were available rather than which were the most optimistic for. So we have not bothered a lot on geographies, which we are looking at. But if I just give you a broad trends, precrisis -- give me one second, I have that number written somewhere. Precrisis, we were buying, obviously, a lot from Gulf and, of course, for many other places also. But post the crisis situation, significant amount of Russian crude also came into the picture. And in fact, very early in the cycle, we picked up a large chunk of all senses together picked up auction for Russian crude. So things like Iraq has gone down very considerably to the Jan, Feb, we ran a lot of -- on those months, 20%, 25% of my purchase were Iraq, it has gone down considerably because nothing is coming out of Persian Gulf. On the contrary, Russian crude was available in the market on sees that was procured and there was a lot of other crudes even African crudes went up during this period. Some of -- we also got crudes from U.S. Some of you would know that we even import a cargo to from places like Venezuela. So that's the broad shift in the numbers, which we have had. I hope that answers your question. On LPG, to be fair, it shifted from a lot of term contracts in Middle East to actually a lot of spot cargoes where -- at the time, you were even buying spot cargoes on the sea in the market where you're less worried about whether it's coming from geography or geography, but more on when it can reach my shores. But that shift has definitely moved away from Persian Gulf to other locations. Now parts of that world is also registered and some of the gas from Persian Gulf is also coming out in different forms. On your second question on inventory gains, maybe I'll ask Director Finance to give us...

Yes. Yes, it's true that there were elements of inventory gain, which are sitting in our books of account. But to be realistic, considering the fact that there have been so much of volatility, plus the accounting adjustment because of the NRV reductions and all, we would not like to share the numbers once the stability is there as regards the pricing, and it returns back to normal. I think that would be the right time for us to share the numbers so that you can accordingly put it in your model. Whatever numbers I would be otherwise would lead to some incorrect adjustments in your model. So I'll refrain from giving the inventory gains or losses numbers there. But coming to your LPG under recoveries, the full year under recovery was around INR 5,200 crores. And for the quarter, it was around INR 1,350 crores, but I guess this -- not against this, but we have also got around 5 installments of the LPG compensation totaling to around INR 3,300 crores during this period -- in this current financial year.

We will take the next question from the line of Nitin Tiwari from PhillipCapital (India).

So sir, there have been a number of figures which are there in the market into of the kind of combined losses that oil marketing companies are currently incurring a broad ballpark is spent around INR 1,000 crores. I just wanted to understand what that number for us in terms of our daily run rate of a loss. That would be my first one. .

Yes. Thanks. I think that's the question on mind of everyone. But as I said in the opening remarks, we are not going to give a forward-looking guidance on this. I'm also fully aware on what kind of numbers we read the press every day. I think Honorable Minister from the podium at the CI conference yesterday talked about a directional number for all the OMCs there. Obviously, he does not know the exact numbers, which we have because being listed companies, the numbers are with us only. But all I would say, we are incurring losses right now, and we are doing our best to manage the losses there. And what could be the order of magnitude is known. And I'm sure at the right time, right decisions will be taken. But we will not be giving a forward-looking guidance because being a listed company, being financially responsible. It becomes very easy to give a guidance in a volatile environment right now -- like we have right now.

Fair enough. Sir, I'll take that. Secondly, sir, my query was with regards to procurement and days of inventory. So you said that like you mentioned about crude that we are covered for coming 2 months. What's the situation with respect to key products? How much of product inventory are we holding as of now in terms of days of holding for petrol and diesel and also for LPG, if you can help us understand that. And second, your procurement front, when you are reaching out in the spot market. So is that through traders? I mean how does that procurement work? I mean do we have basically a say in terms of which geography you're going to procure from or it's just a tender floated out later to collective of where it is getting fulfilled from?

Yes. I think first point on days of inventory, let me give it very simple for all of you. At a macro level, the supply chain on liquid fuels is roughly moving similar to what it was precrisis. What do I mean with that? Precrisis, I will always book. If I was sitting in middle of May, I got to be working like cargoes. That is what I'm doing right now. I have my June fully covered that is provided, we always have 45 to 50 days fully covered. And for Mumbai, we would have 30 to 35 days covered because that was a difficult cycle. All through this period, barring a day or 2 here and there, we've had this fully covered, and we are very comfortable on the crude supplies. We don't see any issue on the crude supply at all. LPG, there were challenges there, but with the passage of time doing multiple things and also best management at the country level on LPG by increasing production, managing or directing the supplies and some amount of demand dampening. That institution has been managed, and there is, on a daily basis, across all OMCs across the industry, we look at coverage, are we comfortable? We are very comfortable on the coverage we have for LPG available with us. There is going to be no shortage in May. There's going to be no shortage in June. And as July comes in, there is going to be no shortage in July also. We are -- that's -- anyway, we always looked at 45 to 50 days there. On the product availability in my supply chain, that's roughly similar to what it was. I would carry sometimes I remember correctly, 30 days roughly I would carry, and depending on where I'm on pipeline or of pipeline, that's not vary. But if I look at the quantum of inventory we are carrying, barring the operational variations, which would happen someday, it could be a few higher or lower. We roughly have been carrying the same inventory from the product perspective. So nothing much has changed on that, except prices.

Understood, sir. And on the crude procurement front. So why I asked that question is that because there are a number of reports which have indicated that there's almost a 11 million-barrel per day shortfall of crude oil production globally. And I mean, the procurement actually is a function of both time and the short haul. So while a deeper shortfall in a short period of time with management, but as time progresses and if the shortfall continues incremental procurement can get difficult. So I just wanted to understand that when you're procuring crude from the spot market, how is it like -- how does the chain work? And you reach out to a trader or reach out to other [indiscernible] explain that. That would be helpful.

I think I'll again repeat what I've said twice in the call that we are fully covered for as a company. And as much as I know about the sector also we are covered on it. In our earlier analyst call, we have been saying that we buy crude from 41 different countries. And that count might even -- this is only HPCL, other companies might be buying from other market or as a nation we buy back any year we run multiple in our refineries, we can run anywhere close to 180 to 190 type of crudes. And it's not that crude had disappeared from the market, enough of that is available. So there are multiple processes for buying crude. There are term agreements, which we have. We have been doing as a firm also even in this current situation, there are some term agreements on which crudes are coming. If I had a term agreement with any African country, that is not impacted by this thing. By the term agreement with the South American company that is not impacted in the current crisis, that crude is coming. Then there are spot cargoes, all kinds of spot cargoes which come in some, as you said, we buy through a tender. There are some new go to market, there are different ways of inviting in. So as and when we have a need and roughly once a decree go into the market, those of you are close to the trade can look at Kepler data and all those kind of things and have any transaction, sometimes we do a transaction and next date is reported in the press what price we ported a lot of people journalist have ideas of getting it. But if you track Kepler and all you can figure out when do we go to buy vendors IOCL, go vendor BPCL vendors, Reliance for to buy, all of us have been going very regularly. All I would say is the instances on spot has increased right now because like we had some term contracts in Persian Gulf which are not able to supply consistently right now, hence, you have to buy a lot more from spot. But that's not part of my business, I get really worried about. Of course, we are very -- eagle eye on it because any movement up and down, even try to time out, should I go today if something want to happen tomorrow. All those things we'd like to do to mitigate the impact, but I don't worry on the supply side of it. As I said, times have now said on the call, we are fully secured on the crude supply. We are very comfortable on the LPG supply.

We will take the next question from the line of [indiscernible] from DSP.

Am I audible?

Yes.

Yes. Yes. Congratulations to the team for a good set of numbers. I just had a couple of questions, both revolving from CapEx. So sir, you highlighted on the opening remarks that CapEx you have curtailed a bit in this year. And if I see the presentation, we have maintained the number of around INR 77,000 crores for the 5-year period from FY '24 to FY '28. So -- and in FY '26, I believe we have disclosed that we have spent INR 1,700 crores, so all these numbers set aside and the current volatile market in Q1 also, you mentioned the weakness, how do we see the CapEx going forward? Will there be a significant downward revision because I think that will be warranted. So how should we think about that?

Yes. I think all good management will respond to the stimuli, which come from an external environment. When I said we curtailed CapEx last year, maybe it did not so much in the numbers, but you won't know what our internal plans were. Maybe they were higher. They brought it down to a level. And overall numbers also do not show at what point of the time in the year I spent because that also has an impact. And third, we should not forget that we were already committed to a large CapEx stream, which is going. Now forward look, if I look at where I am today, obviously, spending on HRRL, whatever needs to be spent to finish that because have to commission that project. So whatever CapEx has to go in there is going there irrespective of what else is happening there. But however, I have discretion on starting a new project, I'm taking a pause and saying, okay, let's come back to the system after 8 weeks or 12 weeks. A lot of our CapEx, as you can know from a breakup is things like modernization of our retail outlets. Sometimes we have a pipeline to lay, sometimes we have a depot to renovate. Sometimes you can do a renovation in an emergency because there's a safety thing. So if there is a safety emergency, we are concerned with that CapEx. But if there's a discretionary thing that, okay, we have a choice to start that renovation 3 months later, we will postpone that decision. So those are judicious costs the management team is taking. As of now, I think I don't remember the number off hand, but our projected CapEx for this year is slightly lower than last year. But that doesn't mean that we are vetted to that number. If warrants tomorrow, and we get into a boom cycle, we might do more than that. But if the war continue for 3 more quarters, we obviously will do less than that. That's a response strategy I would have on this. Having said that, every committed CapEx and anything which is run towards completing our past CapEx is being incurred as we speak.

Understood. So fair enough. This was a very elaborate answer. Sir, secondly, one small question. You mentioned about the incident at Barmer and a very few number of units that were impacted. Extra CapEx that have we had to incur due to this or that will be very small figure?

I just said 6 heat exchangers in refinery, which has 600 to 800 heat exchangers and thousands of other things was impacted. There was a small amount for refurbishments and there will be some amount of, I think, insurance claims and also kind of thing around it. So it's even if there's a minor thing be rounding of Herring. So it's not -- it's a very localized thing. It's just that when the physicality of that happens, you have to take some -- there is some time kind of downtime which should be there. And unfortunately, for us, it happened on a day when 1 day prior to the inauguration of the plant, which was unfortunate, but we have to live with that. We will be bouncing back very soon on that, I said earlier, and we have given it in guidance to stock markets and the stock exchanges that we hold the guidance which we have given to stock exchanges. And if there is any further update on this, we will duly inform the stock exchanges. As far I would say, we have visibility of coming out with -- if I remember the exact words you have said in the second fortnight of May, we will start reducing some products from the refinery.

We will take the next question from the line of Mayank Maheshwari from Morgan Stanley.

Can you just talk a bit about in terms of crude sourcing. What you are seeing in the market, you can be generalist. You don't have to be very specific HPCL, can you just give us an idea around when you're going in the market today to source crude, what kind of premiums insurance rate case how they have moved over the last few months? And how are you kind of thinking about that now managing it as you're sourcing for July?

Yes, Mayank, I think that's a good question. At the highest level, I would say, in every element, there is a volatility in it, whether it is price, whether it is even insurance premium, there still be number of insurance. Obviously, insurance premiums have gone up. That's a known fact. Earlier, we would have taken a long insurance policy. Now sometimes you have to go cargo-like cargo and some specific insurance policies. So that obviously increases the times involved. Then there is some movement related aspect, especially anything coming close to Middle East, you have to be doubly shore on movement. You have to keep track of movements. Of course, things coming from other sites are actually moving quite normally. When we go to spot, are we seeing lesser number of cargoes, I don't think we are seeing lesser number of cargoes. Obviously, there are certain grades which are not available because they are curtailed or they are very little available. But if in a particular inquiry, 40 people would have participated earlier, actually roughly around the same number of people are participating. In terms of quotes from the people, we definitely see a lot more variation. In the past, the quotes would have been, say, if the delta was x earlier between the highest and the lowest sometimes these times, there are 3 deltas. What also happens, Mayank and this is there are times when you can actually be very opportune on this. It happened with us last 2, 3 weeks ago, we were -- we sourced a particular cargo just as we finished the internal approval on that cargo and event happened outside where we immediately thought prices will fall down. Our team reacted immediately. So after we have given the formal approval and approval. And with the same parties, they could negotiate a discount, a significant discount, a good single-digit dollars in terms of discount, and that's obviously need savings. So the need for agility in cargo buying has definitely gone up. So as -- even as a state old enterprise, I don't always say that, oh, I will set back into my process, I will give you a tender, you give me a response after 24 hours. We've had to change processes where our design making body is sitting right while our trading team just behind the trading team and giving them a decision on the spot. So that's the kind of reaction and agility, which is needed. I think in moments like this agility also gives you opportunities and wherever possible, we have tried seizing those opportunities. I don't know whether I answered your question, but that's how I see the market. If there are more specific details, we'll be happy to put you in touch with our trading desk for further questions.

Sure, sir. Sir, the second question was more related to, and this is what you talked about, I think, [indiscernible], which is the digital thing that you put it on your slide pack. I think you have been, I think, 1.5 years, 2 years back, you guys talked about on AI and now you're talking about generative AI behind your processes. Can you talk us through of how you're kind of getting it through what is the story that you're kind of pushing? And what has been the impact in terms of cost savings, if at all, you are even thinking about these things into the cost saving focus that you guys have.

Thanks. Let me -- I'm trying to figure out which specific slide my team has set.

Slide #41.

Okay. Parikalp. Okay. Parikalp has been...

On the right-hand side.

Next time, we will give you an updated version of this. My apologies, we should have had the latest version on this. In some ways, Parikalp was the program, which HPCL ran for a long period of time. And obviously, we did some amount of movement on digital front. In the last 6 to 9 months, while we have not changed the name of the program, actually, we have not even given it a new name. We have reenergized our digital effort. So what did we do? There were a lot of different initiatives which have been done, some good, some not so good. We have done a big step change or rollover from legacy system into SAP. So a lot of things have been done, but we got one of the best consultants to work on a North Star product and give a very deep assessment on where we are. This happened in the last, I think, third quarter of the year or fourth quarter somewhere around November, December. They have looked at all our business and given us a frank as is the assessment and a road map ahead. Primarily, we have formed a large digital transformation team, which reports to Director Finance and me, basically sit centrally. It has now been argumental to 35 people. We have had big people from across the -- who are now tasked in a 3-year time frame to move forward on the digital initiatives. So that there is a central coordination of all the digital initiatives. What are the themes we are doing 3 or 4 themes we are doing: one, bringing in digitization, automation in many parts of our business. Like I'll just give you an example. Many of you would know that about 80% of our retail outlets are connected real time without central service. We have a system where we can actually see how much petrol or diesel is infilled from which node in which of my retail outlets, I can see that sitting in my office actually if I won't have that much of time. However, there were 2 things we are doing. We are not leveraging the data enough. And second, we are about stuck at 85. Now just to give you a theme, one thing you've said in 2 months, let's get it down to all the legally operating -- by legally, I mean to say there are some places where you have disputes with the pumps. But anything which is cushion in our system, we are connecting it immediately. Second, we have formed in a team, which is looking at data here now -- you can imagine in the current pricing regime there is proliferation of diesel from retail outlets to [indiscernible]. We are catching those guys using data. Every evening, these reports are published, mails go out sometimes dealers are as for showcases, sometimes they are suspended. If we find they are doing transactions which is larger than what the retail outlets. My system can configure or if it is greater than so much later this sell-in, there is a challenge in that. That's an example which we are doing. So saturation, completing the setup is one thing. Second, there are parts of our system which are not connected by IT. Like our supply chains are not fully connected by IT, some terminals, et cetera, I can't read what is the capacity on all my tanks clarity. I can reiterate the terminal, but -- so those kind of interconnectivities we are going. Third, we are using technology to drive in efficiencies. And I'll give you an example from our refining setup where in many of the units in the last 12 months, we have done the RTOs and APCs as they are called real-time optimizers, those kind of stuff. And in some cases, we're getting 0.5% yield extra. So last year, we had done pilots in both Mumbai and Vizag refinery. This year, we have decided that every single unit where we want to put RTO, we will put it in this financial year. We will saturate it this year. And HRRL, once it gets steam, we'll get on to that. That's the third theme which we are bringing in. Fourth, obviously, in line with where do we use AI generative AI. Again, a real example I will give you. We have a vehicle tracking system where 30,000 of our trucks, which go on the road are tracked every day. Now it is not -- they give us -- if it stops at any place, if it goes off route, it should give an alarm. We should be think 80,000 alarms a day. Obviously, nobody is doing anything with the alarms. But using AI systems, now we have managed to get it down to few hundred real alarms a day, custom AI tool, which we have. So that's just as an example, we are doing -- procurement, we are trying to use AI. So you can see Agentic AI use cases, et cetera. And we are also leveraging the power of our people. We're running as we speak, organization-wide Hackathon where our youngsters are participating in some of these things and beating those. So it's a holistic program. So next analyst call will give you an update on the Parikalp. We might even give you a new name for that. But a lot of effort. Part of it is catching up, a part of it is leapfrogging.

We will take the next question from the line of Sumeet Rohra from Smartsun Capital Private Limited.

So firstly, I would like to congratulate you and your entire team for our absolutely stunning performance in an extremely tough environment, so a great show, sir. And I would also like to talk a few good words about our Director Finance Mr. Narang, I mean, it's been a real honor and a pleasure interacting with him over a decade. So sir, thank you very much. It has been honor for all investors and analysts to always speak to you at conferences and on analyst calls. So sir, thank you and wish you all the very best and for a great future sir after January. . Now, sir, coming to just a few questions, which I have from my side. So sir, see, firstly, this government has known to be a very proactive government, as you know, for the conference we had in last September as well where our Honorable Oil Minister spoke very clearly talking about bold initiatives. So sir, do you think that probably the time has come wherein there could be a possibility that we could go back to something like what we were in the past like a daily kind of a pricing mechanism or something of that sort. Sir, secondly, there has absolutely been so much noise in the media about this INR 1,000 crore figure, but sir, is my understanding correct that a substantial part of the INR 1,000 crore would be the LPG part, which is actually the running account of the government and not necessarily borne by the OMCs. So is my understanding correct on that as well that the LPG losses are the ones which are contributing substantially towards the INR 1,000 crores if at all, so it is, which is quoted in the media. Sir, my third question, sir, is on the Barmer refinery. Now the matter of fact is that we are ramping it up. So our dependence to buy products from third party would start coming off very sharply. So can you just throw some bit of highlight on that? And sir, just one last point as our Honorable Oil Minister yesterday spoke about that he interacts 1.5 with all the CMDs of all the oil companies. So what is the general thought process because even today, the RBI governor has spoken about fuel price hikes happening. So what is it that government is actually contemplating in terms of pricing? Because they are a very reformed government. So I'm fairly confident that they will take the correct measures. But if you can just share some thought on that, it will be very good, sir.

Thanks, Sumeet. That's a lot of questions. I'll have to check my memory to remember all. But if I forget, you can remind me. I think let me start with the last point, which is there. See, obviously, as Honorable Minister said on the stage yesterday, there has been a very active condition across OMCs, across all the sector companies with the government, and it does include a daily meeting at least 6 days a week, if not 7 days to look at things we obviously discuss all the situations, what problems we are having, what issues all there. Now what the discussion forward-looking is, I'm not going to discuss in this forum, not fair for me to do that. But all I would say is, again, I'll draw from what is in the public domain. Honorable Prime Minister said that the companies are facing the challenge of it. I think RBI Governor also, we were speaking at the conference today, he was on television about a couple of hours ago, spoke about it. Honorable Minister spoke about it. I think there is a recognition and to be fair, the OMCs have -- which should the shock to the economy at this point of time. Now whether the shock is, yes, there is some on account of LPG losses also because LPG was very scarce commodity and prices were very high. To be fair, there are losses on liquid works also because crude, which we are buying at 60s in terms of dollars, $60, $65 3 months ago or 4 months ago, is easily touching $100 at times $110, $120. So could have gone up by 70%, 75% on what we were buying year of $30, $40 in absolute terms. So it has obviously impacted the product prices, the realization product prices also, which at times depending on those refinery in and other things can be significantly in negative itself. I think everybody understands the issues, and I'm sure the right decisions at the right time would be taken balancing all those factors. What those decisions are not fair for me to comment on this. The only thing I would say is I think you were part of that group when we had the analyst meet in Mumbai a few months ago. And both the Secretary, Mr. JN and Honorable Minister. Actually, both from the stage had talked about the fact that they understand the dynamics, and they have encouraged everybody to look at the sector as a long-term sector not as a short-term spike. So just in the last 3 quarters, there were enough people who were saying, oh, oil companies are earning more than what they should be earnings. This quarter, they are earning less than what they should be earning. But hopefully, like from a longer-term perspective, life would balance out on those. On the more operational question on Barmer product and all, yes, once all those things stabilize, depending on how far the will grow, we do expect HPCL's dependence on outside products to reduce. It won't come to 0, but there are obviously exchanges we do with other oil companies, and there are some packages because of the contribution we will need. But there will be times when at least for the next few years, we will be potentially surplus with diesel. And we are working on plans on how to utilize that. Of course, if the economy grows faster than diesel grows faster, we'll be able to absorb it in India. If not, we will have some amount of products which we can export outside the country, and we are trying to figure out what's the best way of it. Some studies have been done some outreaches have been done. But that -- we had moved far further down on that. But after the crisis, we have paused that because right now, every country is looking at securing the product for itself. Once the situation eases and the world back to the normal, we will again cohort the best way of utilizing our surplus product. But we are fully conscious of the fact that we would literally become depends -- I would say, we will still take products from 2 of our joint ventures or 3 of our joint ventures. But as an ecosystem, HPCL would be reasonably self-sufficient on most products.

We will take the next question from the line of Vidyadhar Ginde from Sohum Asset Managers Private Limited.

So my first question is the big losses on diesel and some petrol have started. Have the private players sort of try to increase prices and price themselves out or their market share roughly remains what it was for this event happened?

Sorry, the line got distorted in between. Could you repeat the question, please?

Yes. So my question was that has the market share of private players gone down in petrol, diesel, have they price themselves out of the market? Or they continue to sell at these higher losses and their market share is roughly what it was in Jan, Feb?

I think, you all are very smart analysts. You can just take a drive down the high figure out and you'll get the answer to your question. All I would say is this is in this moment of crisis, there were 3 oil companies who are standing with the Indian consumers, there were the 3 OMCs. They stood by the Indian consumers. They face the bunk. We got a lot of negative press for use in front of our retail outlets. While the queues are only happening at the retail outlets, which are supplying. No queues was going to be ever reported at a retail outage, which was not supplying. So if I have a wish right now, I've had more money, I would have done a tagline, which says that we stood by the customers. That's all I would say on this. Whether your own judges, you take a drive around and you can figure out where the market shares have fallen.

My second question is that you probably are having big losses on diesel and also significant losses on petrol marketing, but you are, at the same time, making higher tracks on -- especially on diesel. And on extent what you outsource, you probably are making much smaller losses. So the number which the Minister has quoted, is it -- if you could give us some color, is it closer to the net number of the extent to which the losses on market to exceed losses which you make on refining? Or is it the gross marketing loss number?

Yes, I said in the call. We will not be giving any forward-looking guidance. I think that there is a number which public domain is fair. That was maybe a directional level given by the Honorable Minister. I lead a listed company. Momenta gave a guidance on an analyst call, which is recorded doing that, I have to be sure of the numbers. Given the volatile situation in 2 or 3 instances, we have said that we are uncomfortable giving a number, and we will not give that number, because it's unfair at this point or what if prices change tomorrow, the things will go all over the place. I know you guys are anxious on that number. But as a responsible, listed company, I will not get that number.

And lastly, just I hope that in the current year, if unfortunately the war drags on for a longer time, we won't have a repeat of FY '23 when you were allowed to lose money in the red. So I hope that it is ensured that the authorities that matter is conveyed that it is not fair to allow our company, which is its national duty to go into the red. .

I think there are enough instances of the government thinking on this in public domain. As far as -- I'll recall just in at the time on [indiscernible] was addressing the parliament in response to the President's speech at the session of every year, which is given in parliament. He actually mentioned the fact that with a lot of pride that many of the state-owned companies, which used to language earlier are performing very well and doing the duties. Maybe those who are at the analyst meet both with the Secretary, Mr. Pankaj Jain and the Honorable Minister from the dies last year when we met had clarified this point very clearly and encouraged all of us to look at the long term when you are dealing with these companies rather than looking at the short term. Just give me one second. So this is something which -- I think that should be enough for us to give the queue that notice on to be left high and dry. All what we can say from our side, we are definitely doing what is required to manage the situation. We are doing it with a lot of custom -- right now a lot of steel.

We will take the next question from the line of Yogesh Patil from Dolat Capital.

Some numbers side again, but I hope you'll be able to share it, not on the pricing side. What is the proportion of petrol, diesel and the HPCL purchase from the other refiners to market at the HPCL. If you could share these numbers in the million metric tonne, that would be helpful. .

I think what I would say is on this one, you can reach out to our corporate finance team, they can share the detailed numbers. So you can drop them a query, they will give you the share numbers. I'm conscious of everybody's time on this. We do take product from others, and I think that's a fairly declared number. Some of -- and what we have taken in the last quarter or we are taking right now is roughly in the same ratios, which we were doing earlier. We can give you the exact numbers, please take it offline with our corporate finance team.

Okay. Second question, again, the pre-war level, we used to take the Saudi benchmark for the LPG prices. Now in this current scenario, float scenario, what would be the ideal benchmark for the calculations for the LPG prices? And also wanted to understand key challenges in sourcing of LPG from United States. If you could little bit throw some lights on this. .

The benchmark obviously, Saudi CB is used as the benchmark that itself has gone very high, but not only benchmark, the premium on the benchmarks have also gone very heavy in the recent past. I think there is one benchmark, which we used in the government. I'm sure the government takes care of its benchmark. For what you guys do, I think you will have to then for yourself in terms of what benchmarks do you want to use. The only thing I would say is from the benchmark. It is a very volatile situation as compared to what it was earlier, both in terms of benchmarks being high and the premiums on top of the benchmark. That was the first thing. What was the second question?

What elements go into...

No, that was the U.S. No, no, I got it. I remember it. So U.S. sourcing, I think oil marketing companies had actually taken an initiative to source LPG from U.S. We had already under contract for multiple cargoes, which actually incidentally started from January. So every month, all the POCs are getting 4 cargoes between them, and there are some optional cargoes, so that is flowing all this while. To source short term, I think the biggest challenge is 2 challenges exist. One, there isn't too much of surplus LPG capacity anywhere in the world. That is one. Second, practically for U.S. the distances are too long. It takes about 80 days for a ship to turn around from here to there. The same thing for Middle East was 14 days. So if I need 10 ships for Middle East, I would need 40 ships for there. So all those things are practical difficulties on it. Having said that, our sourcing from U.S. and LPG in this period has also gone up. A lot more has started coming in May and now will come in June than in March itself because immediately, obviously, even if you had action it, it would have come immediately.

And the last one, if you could just give us a perspective compared to Arab, Gulf or Middle East, the actual landed cost of LPG from Middle East to India and U.S. to India, which will be better than just for our understanding. .

It is absolutely impossible to calculate this at this point of time because you get situations, all kinds of situation in the market from premiums to super premiums okay, somebody absorbing cargo freight prices, somebody is absorbing. So right now, if I have to do a comparison, I do -- I live on the comparison, not on a systemic basis. I live on the comparison on what's happening on the time of the day and the daily basis comparison because in a normal situation, I would have given you those numbers. And typically, in the long run, U.S. LPG was marginally higher than what long run landed marginally higher than what long-term -- long-term average on CPP into India would have been. But right now, it is impossible to. There are cargoes which we suddenly find out this is CPP coming in here. See the last 70 days has been one where the availability of the product has been very scale. A lot of effort has been to just secure the pipeline [Foreign Language] secure the ships, et cetera. I think it's a later factor right now. So it's a very abnormal price to a time to do the pricing comparisons.

We will take the next question from the line of Amit Murarka from Axis Capital.

On the refining side, I just wanted to understand like given that there is too much volatility around the spreads, which we see on the screen, but also on the crude sourcing, as you said, like a lot more spot cargoes been taken plus change in the slate itself. So just wanted to get a sense of like how should we look at refining margins? Like is it still fair to say that the margins that you're earning like with all these constraints around more LPG production and all that is is much better than the pre-war situation. If you could just help us understand that part. .

Yes, I think I see for an integrated company have always held a view. So unless you always ask for grant refined margins frankly, don't matter for me as an integrated company for what matters for me is the crude and the selling price. But having said that, since the question is specifically on refining margin. I would say at the broadest level, you can assume that -- if it was the perfect environment in the same situation, refineries could have produced better. They would have been optimized better because none of the refineries we know had the perfect slates for the products which they wanted to generate, not only refinery, for everybody else also because then people were running what they had available rather than what is most perfect for the slate, which will live. So when you are running the less optimized one, you're obviously leaving some margins on the table. So from that perspective, you can expect refineries to perform strongly on that. On LPG conversion into this, actually, very few refineries have been affected from a value perspective as much. So only if you are integrated, then you are more affected, if you -- otherwise, the math you could never do is there is a limit to how much you can swing towards LPG, and that is well within the operational parameters. So I think it will be too complex to just because refinery to refinery. But broadly, I would say, refiners could have done better in the same environment with all the pricing, et cetera, if they had the operationally the best crudes available. So to that extent, from vantage point, there's a bit of understatement in refinery performance in the recent numbers.

Sure. Understood. But -- but like when you -- if you could just add a bit more on that, like when you, let's say, buy your props from a refinery, any other refinery in the country, there is also that export rebate, which is in place. So is it getting adjusted in the procurement or that's out of time, but.

Yes. To a certain extent, it is getting adjusted in the procurement price.

We will take the next question from the line of Kirtan Mehta from Baroda BNP Paribas Mutual Fund. .

A couple of questions from my side, one on the supply of crude. So for the -- you mentioned that we have started sort of procuring crude for July. And for July, with the return of European refinery from maintenance and globally market short of the crude, which has been lost do you see more challenges for procurement of grow during July as compared to May or June? That was the first question. And second question was, are we also sort of seeing a lower diesel yield than which would have been otherwise because of the unavailability of the medium heavy grade crude which have a higher diesel yield. So is that also sort of making us impact our crude slate would that delay basically the benefit that we see out of the RUF unit?

I think good questions. On the availability from Europe, I don't see any challenge on that because we are in the market. And if I'm not mistaken, we have secured half of July already. As I said earlier, we typically buy on a 60-day cycle. So I think 15 July, we have covered ourselves a normal procedure. And we have not had any difficulty in getting the crudes, which we want and, of course, I would wish they were coming to me $30 cheaper than what they are coming. That's a different aspect. On your question on RUF et cetera, definitely, if I don't get the right crude which is going for that, I cannot run that complex on the most of the things. So it impacts, I will not shy away from saying those. It definitely impacts you when you don't get it. And as I said earlier in the response to previous question, it impacts everyone in the cycle. I can bet no refinery in India was running on the optimum slate because they did not have the optimum crude. They did not have the optimum mixes given the challenges which we had, I'll be very honest, a lot of our RUF, if I -- the best group to run some of the personal. But if they are not available to run on the second best where some parameters definitely go down. So it impacts. And in an ideal situation, the same assets, as I said in response to previous question would give us more returns. That's why I said, broadly, the refinery performance is understated in this quarter.

Sure. Can I also squeeze in one more follow-up on the previous participant question.

Okay.

In terms of the what we mentioned earlier is that we have been incorporating some amount of discounts while we purchase crude from the other refiners on the line of export duty. This round the revisions on the export duty has not been very frequent and periodic. So are our adjustments run in line with the export duty? Or are we sort of adjusting more frequently keeping in view the volatility? And is the target crack around $20, $22 on diesel and ATF at point of time? .

The procurement price of the RTPs are adjusted one, in line with the declared SAD, which is done. And that's one exercise. Yes. Yes.

It has not been announced at least to the media in basis business. So is it happening on a fortuity basis?

It is happening as and when the government declares the SAD.

Okay. And is the underlying target crack around $20 for diesel and ATF at this point of time? .

The government would be able to clarify.

We will take the next question from the line of Vikash Jain from CLSA.

But before I ask my questions, firstly, want to thank Rajneesh ji for all the help over the last few years and of course, congratulations on a great stent and all the best for your future endeavors. And with that, I will, of course, start with an accounting question, given that it's Rajneesh superannuating, depreciation that I see has gone up. Can you confirm when is a large part of the stand-alone linked capitalization already done? Or -- and when was it done? I mean, what would the number look like, say, in FY '27 when -- for the full year?

The part of the depreciation has gone up because during this year, we have capitalized the rough fuel net, that has happened in the last quarter, primarily the full last year quarter. Plus, there is an impairment testing, which has been done for some of our assets. So there is an element of impairment also included in the...

How much would that amount be, the impairment part, sir?

That is around INR 400 crores, INR 450 crores.

Okay. And so would -- is there any other pending capitalization left or almost all of the rough has been capitalized, no?

No, it has been capitalized.

Okay. So can I say that, that INR 2,400 crores minus INR 400 crores, about INR 2,000 crores would be the going run rate? Or was it capitalized during the quarter and not the full quarter?

No, no. it almost -- it took the full quarter, yes. Depreciation was for the January quarter.

Okay. Okay, okay. Sure, sir. And just on the LPG part, roughly -- what are the kind of LPG loss that we saw for the month of April? I mean personal loss that we were running for the month of April like? .

170 in April and 670 May. You got the numbers, Vikash? Sorry, 170, Vikas you said 170 in April, 170 per cylinder.

170 per cylinder and 670 in May.

670, you said?

Yes.

8 Okay. And this number compares to roughly about INR 84 in 4Q. Is that right?

Yes. Yes. Maybe approximately. Yes.

Okay Otherwise, I think is your opening remark was good enough to answer most of the MT questions. So thanks a lot.

We will take the next question from the line of Sabri Hazarika from Emkay Global.

Yes. Just 2 questions. Firstly, this what already has been asked. So -- so with the SAB, our integrated margins could be similar to the other one also who are the higher refining to marketing. Is that right? .

Can you repeat your question, please?

I mean our refining to marketing ratio was lower than other oil marketing companies. But the SAB now takes care of it, right? The integrated margin of all the 3 companies would be similar right now? .

No, no, see. It would depend on the individual refineries -- so what rate they are -- what rate they have bought the crude, fuel and loss and the areas most of other activities, apart from the SAB deals.

Right. But the disadvantage which HPCL had in procuring products from other refiners on a very high crack environment that gets sorted, right? .

Not fully, but partially to an extent, what you are saying is right.

I still don't get the margin on that refining margin on that.

And plus, we don't know at what level SAB has been fixed.

Right. And second is a bookkeeping question. So what is the GRM EBITDA and PAT for HMEL in Q4 and FY '26 as a whole? .

CRM for Q4 was around $17 per barrel.

Okay. And EBITDA and PAT?

EBITDA for full year was around INR 6,800 crores, and for the Q4 was INR 3,300 crores.

INR 3,300 crores positive PAT for the full year?

Okay. EBITDA.

Sorry, positive EBITDA for the full year. right? And I'd like to wish Narang ji and all the best for his future endeavor.

Thank you very much. Ladies and gentlemen, we will take that as a last question. And with that concludes the question-and-answer session. I now hand the conference to Mr. Varatharajan for the closing comments. Thank you, and over to you.

Thanks, Swapnali. I again would like to take this opportunity to express my sincere thanks to Mr. Rajneesh Narang for his extended outreach to the investor community as well as all the support he has been given to all the analysts and the investors all through this year. It was a great effort, and it is a harder thanks from our side. And also congratulation for his future endeavors. I would like to hand over the floor to the CMD for his closing remarks. .

Thank you. It's been almost 1.5 hours you've been on this call, so I won't keep back further. All I want to say is the team HPCL is very committed very excited with the momentum we have built. Of course, I think hard to meet the current challenges but also equally very hungry to create further things. So we had set as a leadership group immediately after the results, and we're starting to do the projection, which is the next time. How soon can we beat these numbers. So hopefully, you will see great momentum ahead. And hopefully, these times would pass until that time, I would say, stay happy and healthy and keep focusing us, those of you who write reports on us, please share them. We'd love to hear your views and also learn from what we think -- what you would think we are not doing well, and again, we'll connect in 3 months from now. Thank you. And those of you who wish to meet us. We are more than happy to have separate dialogues in smaller groups or individually. Thank you and all the best.

Thank you, members of the management. On behalf of Antique Stock Broking Limited, we conclude this conference. Thank you all for joining with us today, and you may now disconnect your lines. Thank you.

Thank you.