© 2024 Alpha Spread Limited. All Rights Reserved.
www.alphaspread.com is not operated by a broker, a dealer, or a registered investment adviser. Under no circumstances does any information posted on www.alphaspread.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. In no event shall Alpha Spread Limited be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on www.alphaspread.com, or relating to the use of, or inability to use, www.alphaspread.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance.
You don't have any saved screeners yet
Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Ladies and gentlemen, good afternoon, and welcome to Q4 FY '21 Conference Call of Indian Oil Corporation Limited, organized by Batlivala & Karani Securities India Private Limited. [Operator Instructions] Please note that this conference is recorded. I would now like to turn the conference over to Mr. Harshraj Aggarwal. Thank you, and over to you, sir.
A very good afternoon to all. On behalf of Batlivala & Karani Securities, I welcome you all to the post result conference call with the management of Indian Oil Corporation. It gives us great pleasure to once again host the management for this post result discussion. I would now like to hand over the call to the management for initial remarks, post which, we'll open the floor for interactive question-and-answer session. Over to you, sir.
Thank you, Mr. Harshraj. We welcome you all to the post results conference call. From the management side, we have got Mr. Sandeep Kumar Gupta, Director Finance, Indian Oil Corporation; Mr. Matthew Thomas, Executive Director, Corporate Finance and Treasury. And along with them, we have got Mr. Ruchir Agrawal, Chief General Manager, Corporate Finance; and Mr. K.S. Kesavan, Deputy General Manager, Corporate Finance; Mr. Subhajit Sarkar, Senior Finance Manager, Treasury; and myself, Prabhat Himatsingka, General Manager, Treasury. To begin with, Director Finance, we'll briefly touch upon the quarterly performance highlights, and then he will take the questions. Now I request Director Finance, Indian Oil, to address the meeting.
Dear investors and analysts, a very good afternoon to all of you. I hope everyone of you is safe and sound. I take this opportunity to welcome all of you to the conference call post announcement of the annual results financial year 2021. Hope you have gone through our results, and you have got the numbers from our teams also. But before I go to the results, first, our initiatives on fighting this COVID-19 crisis of the nation. Team Indian Oil has been working rigorously for the past several weeks for positioning of liquid oxygen and ISO containers or cryogenic road tankers for transportation of liquid oxygen, consequent upon the increased requirement of liquid medical oxygen in the Northern and Western states from the eastern part of the country where oxygen is surplus. As on date, Indian Oil has mobilized 41 cryogenic road tankers and ISO containers for utilization in supply of liquid medical oxygen. Indian Oil is also in process of converting 16 of its LNG fleet to liquid oxygen carriers in view of the prevailing situation. In addition, the corporation is arranging around 200 ISO containers on lease or outright purchase basis. Indian Oil is also coordinating with Ministry of External Affairs, Indian Air Force, Indian Navy and International Corporation division of MoPNG, and Indian missions abroad for procurement of liquid oxygen from major liquid oxygen suppliers like Linde in the Middle East, Singapore and China. Approximate quantity tied up is around 14,000 metric tonnes spread over a period of 3 months. In addition, Indian Oil is providing logistics and transportation support for liquid oxygen being received as gratis from Middle East countries like Bahrain, U.A.E and Kuwait. Indian Oil diverted high-purity oxygen, 99.9% concentration, used in the monoethylene glycol or MEG unit to produce medical-grade liquid oxygen at its Panipat Refinery & Petrochemical Complex. Liquid oxygen generation has been increased progressively from 17th April '21 by minimizing gaseous oxygen consumption by reducing throughput of the petrochemical plant. On date, maximum possible quantity of 270 metric tonnes per day of liquid oxygen is now being supplied to different hospitals in the states of Delhi, Haryana and Punjab. Indian Oil is setting up a cylinder filling facility at Panipat to cater to the dire need of oxygen cylinders. This would facilitate filling capacity of approximately 1,200 cylinders per day at 150 bars pressure. Expected commissioning of this facility is by end of June '21. Indian Oil is also contributing an operationalization of temporary jumbo 500-bed COVID care hospital at Panipat. This facility has been constructed by Haryana government and is equipped with a dedicated gaseous oxygen pipeline of 15 metric tonnes per day capacity, installed by Indian Oil to source oxygen from its refinery complex. Indian Oil is also setting up a PSA-based medical-grade oxygen generation units at 12 locations in the states of Madhya Pradesh, Odhisha and Uttar Pradesh. Indian Oil is supplementing the available cold chain equipment infrastructure of 4 states, namely Jammu & Kashmir, Tamil Nadu, Bihar and Manipur for the storage and transportation of vaccine. Indian Oil has launched a nationwide network of COVID coordination centers for IOC-ians from 25th April '21, providing 24-hour helpline services. As on date, Indian Oil has opened 95 such COVID care centers pan India, with a total capacity of 825 beds. As regards to the vaccination status, around 15,500 employees of Indian Oil have already been vaccinated, which works out to around 49% of the total employee strength. Vaccination of more than 90% of 45-plus age employees of Indian Oil has already been achieved. In addition to extending insurance for the second year, Indian Oil is organizing vaccination drive for approximately 4.2 lakhs of its contract workmen and employees of business channel partners like LPG delivery boys, pump attendants, truck drivers and crew members. Throughout this pandemic, Indian Oil maintained uninterrupted supplies at its ROs, and, in fact, recorded 33.11 lakhs LPG -- 33.11 lakh LPG cylinders delivered on a single day on 30th of April 2020. And nearly 100% of refiling of flights in Vande Bharat Mission is also being arranged by Indian Oil. Now coming to this recent cyclone, Tauktae. Precautionary measures were taken at supply points, retail outlets and LPG distributorships under Kerala, Karnataka, Maharashtra and Gujarat state offices so as to minimize losses and to maintain uninterrupted supply line of POL products. Till this point of time, no major damage has been reported from any of the IOC locations. Some damage at retail outlets with respect to canopy, false ceiling, monolith, hoardings, yard lights, et cetera, has been reported. LPG distribution in coastal districts under Gujarat state office were affected and is likely to be resumed very soon. Now coming to the highlights for the year, Indian Oil commissioned 3,000 retail outlets during the last fiscal year, taking our total tally to 32,060 retail outlets. Additionally, 310 CNG stations and 637 mobile dispensers were also brought in stream. We continue to put concerted efforts to ensure that we retain our market leadership across geographical areas in times to come both through network expansion and enhanced per-pump throughput. Further to XP100 launched earlier, XP95 premium Patrol was launched on 1st May '21 and is now available at 2,500 ROs, and will be available at around 6,000 ROs by July. We also solarized 1,658 of -- 1,658 ROs during the year, taking the total solarized RO number to 18,336, which is around 57% of our total ROs. Company has taken a host of digital initiatives in LPG marketing from asking Alexa to book your next refill to registering for a new connection through WhatsApp or missed call, Indian Oil also launched the Tatkal Indian Service to deliver LPG refill at our customers doorsteps within 2 hours of booking at select cities. Further to launch of Chhotu 5 kg free trade LPG cylinder, the combo DBC scheme of 14.2 plus 5 kg and composite cylinder in 5 or 10 kg, which are lightweight and translucent, have also been launched. We have -- we also have in our bouquet of offerings, Xtra Tej LPG for our industrial customers, which provides fuel saving using our R&D technology. Petrochemicals is continuously scaling new heights in physical performance. Highest ever petrochemical sales of 2.67 million metric tonnes has been achieved in financial year 2021 against previous highest of 2.55 million metric tonnes in financial year '18-'19. This does not include export sales. Besides expanding our existing petrochemical facilities, all our refinery expansions are coming with petrochemical facilities to tap the growth and profit potential. With the commissioning of 143-kilometer long Ramanathapuram-Tuticorin section of the 1,444 kilometer long Ennore-Thiruvallur-Bengaluru-Puducherry-Nagapattinam-Madurai-Tuticorin natural gas pipeline, Indian Oil has achieved a milestone of 15,000 kilometer pipeline network length. In R&D, our H-CNG experiment in Delhi, wherein we are plying 50 CNG buses on in-situ H-CNG fuel, is progressing well. Further to adoption by a refinery in Serbia earlier, our INDMAX technology has been selected by NRL also for its upcoming 1.9 million metric tonnes FCC. Aligning Indian Oil's business objectives with national priorities, we have sharpened focus on bioenergy and renewables also. Indian Oil has initiated marketing of CBG from 11 plants through 18 retail outlets is spread over 5 states with total sale of CBG into 2021, exceeding 962 metric tonnes. Presently Indian Oil has a portfolio of 230 megawatts of renewable energy, consisting of 168 wind and 65 megawatts of solar. For electric vehicles, we now have 257 charging stations and 29 battery swapping stations throughout the country. We are also working on aluminum air battery technology with a foreign technology company with plans to put up manufacturing facility in India. We retained numero uno position in lubricant sales and registered highest ever growth of 24%, which translates to a volume of 98 TMT with doubling our profits from lubes. New lube facilities are also coming up at Haldia, Baroda and Panipat refineries. Gas sales also achieved -- also registered the highest ever volume at 4.767 million metric tonnes during the year. Talking about numbers, the average price of crude Indian basket during the quarter was at $60.45 per barrel, an increase of 35% from the average price of immediately preceding quarter, that is Q3 FY '21. If we compare on a yearly basis, the average price during the current year has been $44.84 per barrel as against $60.61 per barrel in financial year '19-'20. With respect to crack spreads, MS cracks has improved during the quarter at $5.39 per barrel with reference to Indian basket of crude as compared to the preceding quarter which was $2.97 per barrel. Cracks are also higher than the corresponding quarter of FY '20. For HSD, the crack spread during this quarter at $3.78 per barrel has been higher as compared to the preceding quarter of $2.44 per barrel. However, the cracks are significantly lower than the corresponding quarter of financial year '20, which was at $8.77 per barrel. As far as petrochemical spreads are concerned, spreads for polymers in this quarter at $690 per tonne was 6% higher than the previous quarter and about 45% higher than the corresponding quarter of FY '20. In case of PTA, the spread during the quarter was about 39% higher than the previous quarter. However, the same was 2% lower than the corresponding quarter of FY '20. This quarter, we have registered a profit-after-tax of INR 8,781 crores. And for the year 2021, PAT is INR 21,836 crores as against INR 1,330 crores in FY '20. As you are aware, the unprecedented fall in crude and petroleum product prices in March and April '20 led to extraordinary inventory losses during FY '19-'20 and resultantly dragged down the profitability of last year. While in the current financial year, the crude prices have been on an uptrend, thereby resulting in accretion to margins. With vaccinations being rolled out across the globe, we are expecting improvement in refining margin environment going forward, which should help recovery in crack spreads. Revenue from operations during this quarter is INR 163,606 crores as against INR 146,599 crores in the preceding quarter of this year. Now let me briefly touch upon performance of major verticals during Q4. First, refineries. The throughput during the quarter was at 17.6 million metric tonnes with a capacity utilization of 102.4%. The throughput of FY '21 was at 62.4 million metric tonnes with a capacity utilization of 89.5%. Throughputs were severely impacted during first 2 quarters of the last fiscal due to fall in demand because of COVID-19. IOCL refineries have registered a GRM of $10.59 per barrel during the current quarter. The normalized GRM after stripping of inventory impacts and factoring in price lags for the quarter is $2.51 per barrel. Our refineries have outperformed the benchmark Singapore GRMs during Q4. Singapore GRMs being $1.79 per barrel. Coming to pipelines. The capacity utilization of our pipelines was about 92.4% during this quarter as compared to 92.2% in Q3 of FY 2021. Capacity utilization of pipelines during FY 2021 was down by 10% at 80.4% compared to previous financial year. This was due to impact on both crude as well as finished product throughput due to COVID-19. Our pipelines continued to generate stable returns, giving an EBITDA of about INR 1,600 crores during this quarter. The marketing -- coming to marketing. The petroleum product sales during the quarter was 20.82 million metric tonnes as compared to 21.23 million metric tonnes in the preceding quarters. On a yearly basis, it was lower in financial year '21 at 74.75 million metric tonnes than in financial year '20. The marketing EBITDA for this quarter stood at INR 3,443 crores as against INR 7,130 crores during the previous quarter. In Petrochemicals, during the quarter, the Petrochemicals business reported an EBITDA of INR 2,248 crores as against INR 1,954 crores in the previous quarter. Better margin environment, along with increased production volumes has been posting healthy EBITDA in the Petrochemicals segment during the year. On borrowings front, the borrowings as on 31st of March '21 was at INR 102,327 crores as against INR 116,545 crores as on 31st of March '20. The above figure as on 31st March '21 includes a lease obligation of INR 7,914 crores, which has been classified as borrowing as per Ind AS requirements. The decrease in borrowings have been primarily driven by reduction in receivables from GoI and normalization of inventory levels as compared to that of 31st of March '20. I end my briefing here, we will now take your questions. Thank you very much.
[Operator Instructions] We have our first question from Nafeesa Gupta from Bank of America.
Sir, could you give us the split for the inventory gains, please, for the quarter?
Now these price fluctuations now have become a regular phenomenon. And every year, we are seeing the fluctuation in the prices, which are resulting in inventory gains and losses. Even the crack spreads are also varying to a large extent, which are also a part -- integral part of the margins. So now to give a particular set of figures, perhaps, is not okay, and hence, we are not giving this figure since this is not a statutory requirement also. However, since we have been reporting GRMs as a part of our results, we also have given the net GRMs, stripping off the inventory impacts.
Got it, sir. Again to repeat just the core GRM for 4Q '21, did you say it was around $2.3 for the quarter?
No. For the quarter, it was $2.51 And for the full year, it is $2.31.
All right. Got it, sir. And sir, my second question is on the throughput for the petchem and refineries. On the petchem front, firstly because of the oxygen supply, what kind of throughput losses do you see there? And on the refineries bit, so again there had been some...
There was... Excuse me, Nafeesa. there was an interruption. Can you please repeat this question?
Yes, sir. So I was saying that on the throughput front, firstly, also the petchem side, since we've been supplying oxygen for COVID, what kind of throughput impact do you see happening on the petchem segment? And also on the refinery, since there is some demand disruption on the fuel side, what kind of throughput drop for the refineries?
Yes. First, on the oxygen from Panipat Refinery. This oxygen was being utilized for MEG plant only. Whereas our main stay in petrochemicals is naphtha cracker and PTA. So we do not anticipate any noticeable difference in the throughputs of petrochemical on an overall basis or consequently on the profits. Now coming to the petroleum, though COVID took a great toll of demand in the recent fortnights, but we are seeing the situation fast improving with decrease in the number of cases throughout the country. And we hope that the situation should get corrected soon, and it should not take that long which it took in the first phase of COVID. So April throughput -- April refinery throughput was at 96%, but it was scaled down in the first fortnight of May to 84% -- 84% 85% and perhaps may continue at lower levels in this fortnight also, but we are seeing the situation fast improving.
Got it, sir. And sir, lastly, on the CapEx, how much was the CapEx in FY '21? And what is the target for '22?
Last year, we spent about INR 27,000 crores. And this year, our target is about INR 28,500 crores.
We have next question from the line of Mr. Avadhoot Sabnis from CIMB.
First question, sir, as far as GRMs are concerned, we have been giving a reported GRM number as a normalized GRM number on a regular basis. Now if I look at your stated normal GRM number, FY '21 is $5.64. For the first 9 months, it was $2.96, okay? Sorry, but as per my calculation, then automatically, the fourth quarter number tends to be $12.5 and not $10.6, which you are saying. Similar, sort of, there is anomaly for the normal GRM as well, as against $2.5 that you're saying for the fourth quarter, it actually works out to $4.5. Could you please clarify? Or have I got something wrong?
Though your computation might be correct, there was some restatement, some recomputation at our end, and we have accordingly restated the numbers.
So fourth quarter number is the right number and that's per the restatement?
Yes, which is gross $10.59 per barrel and net $2.51 per barrel.
Second is, could you share the latest debt number, given that historically, the March number is not a representative of the average number for the year or the quarter?
It is at about INR 87,000 crores, which is roughly -- you can calculate the debt equity accordingly.
Fine. And what was subsidy dues over the March, government subsidy dues?
Now subsidies are very less. And the total outstanding as on, say, 31st of March, claims lodged, claims not lodged, is INR 650 crores.
Sorry, sir, now?
As on 31st of March '21, the total receivable from Government of India towards DBTL, et cetera, is only INR 680 crores, which also includes claims to be lodged for the month of March.
Sorry, INR 680 crores. Yes. Okay. I'm sorry, can I just squeeze in a last question, which is the staff costs have gone up by 22% in FY '21. Any explanation for that?
Yes, yes. Last year, we had a profit of INR 1,313 crores only. And so there was no provision for bonus as per DP guidelines to employees. This year, since we have profits, which are the normal profits as well as incremental profits over last year, so there is a bonus provision of about INR 1,800 crores for bonus for employees in this year. That is the primary reason for increase in the staff costs.
But would this INR 1,800 crores be then -- INR 1,800 crores will be for this year only? Or would it cover something for last year also? I'm trying to get, obviously, the sense of the preceding year staff costs.
For this year only. And this is as per DP guidelines.
[Operator Instructions] We have a question from Sabri Hazarika from Emkay Global.
I've got 3 questions. The first 1 is relating to your -- did you mention that the Ennore-Tuticorin pipeline has been completely done or some work is pending right now?
No, no, no. It is not completely done. I said one section has been commissioned. But the other sections, it is still to be completed. So I said that only -- in addition to Ennore-Manali spur line of 22 kilometers, which was commissioned in March '19, Ramanathapuram-Tuticorin section of 142 kilometers was completed in February '21. And beyond that, Ennore-Thiruvallur section of 154 kilometers will get commissioned in June '21. And likewise in August '21, some section, some section and last section perhaps is expected in February '22.
Okay, sir. Secondly, you have got like -- you have mentioned in your presentation 3 major expansions from refinery that is Panipat, Barauni and Koyali. So all of these are under implementation, right? Nothing -- I mean, they have been -- the work has been started in all of these, right?
You said which? Which ones you said?
Panipat, Baroda and the third one is, I think, Barauni.
Yes, we are expanding Barauni, which was approved earlier, and Gujarat also, which was approved earlier. And Panipat was approved recently. So work on all these projects is on.
And what is the time line for commissioning of this expanded capacity?
Yes, I will just tell you. Panipat is September '24, Gujarat is August '24 and Barauni is April '23.
[Operator Instructions] We have a question from Mayank Maheshwari from Morgan Stanley.
Sir, 2 questions from my end. One was regarding petrochemicals. Can you just give us a flavor of how has been the demand now for the month of May? And how has been your utilization rates on petrochemicals in the last quarter and what's been the run rate right now?
Yes, just a minute. For -- say for naphtha cracker -- starting with naphtha cracker. Naphtha cracker only was affected in the first quarter of last year, but beyond that, whether it was Q2, Q3 or Q4 of the last year or it is April or May of this year, it is continuing with about 110-plus percent capacity utilization. So even in May, for the first fortnight, it is doing a capacity utilization of 113%. Similarly, our LAB plant at Gujarat in May is doing 111%. Ex-PTA is a little lower because perhaps there is a shut -- there was a shutdown. But in April, it did 86%. And our PP at Paradip is lower at about 65 -- 60% to 65% only because of limitation of the feed also, for which we are taking up action to line up imported feed.
Okay. And sir, can you just also talk a bit about your plans on the -- because you have now EV charging stations as well as you are focusing a bit on hydrogen as well. Can you just talk about what are you kind of thinking from capital allocation perspective next few years on these businesses versus the refining side of the business?
No, these EV charging stations or battery swapping stations, hydrogen, in any case, is a little distinct. These, in any case, are not going to take a major toll on the CapEx. The requirement of CapEx in these facilities is not much.
Okay. But is there a target that you have if you want to go in the next few years on how much stations you want to put in, et cetera?
The things are little unfolding actually, and sort of capital allocation also keeps on getting revised. So I will not be giving any number right now. You must appreciate that since more than a year now, the situation is very fluid. So let it stabilize, and then we will perhaps, at a better time, we will tell this figure.
We have a question from Mr. Amit Rustagi from UBS.
Sir, my request actually pertaining to the buyback or the dividend decision. I think we have been paying a very good amount of dividend. And so would you give an update that any consideration is given to buyback of the shares because some of the companies have done it in the past, there have been a good due performance of the stock price as well.
You would appreciate that if there is any decision to this sort, we will first inform the exchanges.
Sir, I'm just discussing from like what are the factors which you are considering against the buyback. I think you must have given due weightage to both the decisions of buyback versus dividends. But what are the factors which you think are against the buyback decision?
I'm saying if there is any decision, we are supposed to inform the exchanges first.
Okay, so we are not considering any sort of buyback or any...
I think I have answered your question.
Yes. Okay. And sir, second thing, regarding the refining CapEx. So we have seen that already, our refining integration is one of the best or highest in the industry. And in times of current situation or in the longer term, if there is any impact on the product demand, then what is the risk here to expand all the refining capacities at one go. And by the time this refining CapEx gets materialized, the outlook on the refining margins may not be very, very certain. So what are the thoughts actually which are going into these projects? And what kind of IRRs we are considering for determining approval of these projects?
Yes. So the -- your hypothesis regarding the demand or the refining margins, I do not know whether it's founded or unfounded. But we have from our own sources and studies, a very favorable opinion about the demand as well as the cracks which will prevail. Till the time it peaks, even in India, though globally, it may take very -- though globally, it may take a little lesser time. But in India, at least, the demand is going to be there. And accordingly, we are expanding our refinery capacities to meet out the local demand.
What kind of GRMs we are considering for approving...
Mr. Rustagi, can you please come back in the queue? Mr. Rustagi.
This is just a related question on this. I'm just adding 1 sentence to that. Sir, what are the GRMs you are considering for approving these projects?
So to better answer this, we approve our projects only with a hurdle rate of 11% MIRR.
11%?
Yes.
We have our next question from Mr. Vidyadhar Ginde from ICICI Securities.
Can you hear me?
Yes.
Yes, can you give me your crude cost in March '21, average cost of your crude? And the volume of crude if you had as of March '21?
No, I will not be able to give you the price for March because that is something very, very confidential for us. But you have the Brent demand -- prices for Dubai and Brent available with you. You can make a guess from there.
What about volume?
Volume of inventories again -- volume of inventories is again a confidential information, but we generally keep around 15 million to 16 million metric tonnes of crude and products at any given time -- point in time.
What about the petrol, diesel sales volumes in April and May, how are they doing right now?
Yes, I will just give.
If you could give comparison with '19, it will be better rather than Y-o-Y?
The comparison to -- okay. Just...
If impossible. Otherwise, we can work out.
No, no, no. I'll give you. For the month of May, with reference to May '19, we are minus 33% in petrol and minus 35% in diesel. Industry-wise, I'm saying, all 3 OMCs put together.
And in case of in April?
Just a minute.
And this May data is up to when?
April, it was -- for petrol, it was minus 5% roughly. And for diesel, it was around 11% minus. This is in reference to April '19.
Yes. The May data was up to when?
Pardon? Hello?
Mr. Vidyadhar? Sorry, just check with his line. Meanwhile, I'll take the next question. We have a question from Manikantha Garre from Axis Capital.
I wanted to check on one press release, which has come a couple of months back, where you have mentioned that hydrogen generation units at the refineries will be sold. And these are mentioned as noncore. A little intrigued with that statement because hydrogen production became -- how come it became noncore if it becomes part of your long-term energy transition strategy? I mean, does it mean that we are going to only retail hydrogen and not focusing on production? That's my first question.
No. I don't recall that we have ever said that these are noncore. We said we are going to monetize our hydrogen units to begin with and perhaps subsequently other hydrogen units at other refineries; these 2 are at Gujarat refinery. And the rational of monetization for us is basically to leverage on the operational efficiency, with which the plants can be operated by an expert in this field, any gas company which is an expert of running these plants and maybe produce even more than our captive requirement, which can then be sold as a merchant sale.
Understood. The article mentioned noncore, so that's the reason I was asking that. The second question is with respect to this 200-plus more containers that you are planning to either lease or buy out outright. If you buy out what would be the CapEx? And once the purpose has been solved, can there be repurposed for something else is my second question?
Yes, they can be repurposed definitely. And I don't think this is a time to discuss about the cost of these equipments considering the grave medical urgency, which is there in the nation.
We have our next question from Mr. Nitin Tiwari from Antique Stockbroking.
I have a correct over there. I'm with Yes Securities now. So if you confirm, Yes Securities. Sir, my first question is regarding CapEx. In FY '21 and '22, what is the broad breakup of our CapEx in terms of various segments, refining, marketing, et cetera. And related to that, basically, which are key projects which are going on as of now? And if you can give the investment and commissioning date for those projects? So that would be my first question.
Mr. Prabhat will be answering this.
Yes. I'll just provide you the breakup of this major CapEx for '21-'22. So refineries, we have around INR 5,000 crores. And pipeline, again INR 5,000 crores. Marketing at INR 6,600 crores. Petrochemical, there is INR 2,580 crores. CGD, including JV, we have got INR 1,500 crores. And other JV projects, we have got around INR 1,000 crores . And then we have got some small below INR 25 crores, a lot of other projects, which is around INR 4,500 crores.
Sure. This is for '21, sir?
'21-'22.
No. Breakup that you gave, this is for FY '22, right, sir? For FY '21, similar?
Yes, for current year. You want for 2021?
Yes.
Okay, 2021, refinery, again, we had INR 5,058 crores. Pipeline, it was INR 4,677 crores. Marketing, it was INR 6,124 crores. Petchem, INR 2,630 crores. And CGD, city gas distribution, including JV and our own, we had INR 4,000 crores we had spent on CGD. And JV -- other JV projects, which we have got, INR 1,351 crores. And small CapEx projects, which are below INR 25 crores, INR 3,149 crores. And a small amount, we have got R&D, INR 50 crores, we are building a new -- constructing a new campus, so INR 50 crores on that. And E&P is INR 49 crores. I think this is it.
And sir, the second part of this question, which are the key projects which are going on right now? What is the intending CapEx and commissioning timelines?
I'll just -- I'll just read out the key -- just tell you the key major projects. One is Paradip-Hyderabad pipeline, which is scheduled to be -- is completed 94% up till March '21 and scheduled to be completed in March '22. Another is Koyali-Ahmednagar-Kolhapur pipeline. It is 85% completed up till March '21 and scheduled to be completed in February '22. Extension of Paradip-Haldia-Durgapur pipeline. This is a pipeline up to Patna and Muzaffarpur. This is scheduled -- this is completed up till 70% -- 87% and is scheduled for completion in December '21.
Actually, this is a long list. I'm intervening. I'm again, Sandeep Kumar Gupta. As you like, we can briefly mention about the refineries. We are expanding our Panipat refinery to 25 million tonnes, then we are expanding our Gujarat refinery to 13.7 million -- from 13.72 to 18 million tonnes. Barauni from 6 million tonnes to 9 million tonnes. We have a JV project with CPCL to put up a 10 million tonne unit at Nagapattinam -- 9 million tonne size. Then we are -- we have a Para Xylene and PTA project at Paradip. Ethylene project is going on at Paradip. We have acrylics/oxo-alcohol project at Gujarat refinery. So these are some of the refinery projects which are going on. There is a whole list of pipeline projects, which are also...
Sure, sir. I'll get offline in touch with you and take them. And sir, my second point is not actually a question, sir. It's actually a request and a very humble one, sir. So you guys have been sharing certain data points with us, which help us in our understanding of the company. Inventory gains on the crude and marketing side as being one of the key data points. So I would just request, sir, please continue with that. Although, I know and understand it's not a statutory requirement, but I would request that please do continue with that disclosure because it helps us understand the dynamics every quarter-on-quarter rather more coherently. So just a request over there if you might consider, please?
I've already replied. So let us talk later.
We have our next question from Mr. Probal Sen from Centrum Broking.
Am I clearly audible?
Yes.
Yes. Just wanted to understand, you did speak about the demand scenario in April and May. I wanted to understand with the -- what is the margin trend that one has seen in the first quarter? Fourth quarter, of course, the numbers are there for us to see. Has there been a significant change in fuel margins in April and May, sir?
Yes. Generally speaking, they are on improvement. So with sort of every passing day, we are seeing some improvement in the crack spreads of MS and HSD. And hopefully, with this vaccination and opening up of the economy with lower number of cases, we believe the demand world-over, in fact, the foreign countries have already opened. So the demand for fuel products in those countries abroad will drive the product, crack spreads, which will also benefit us.
I was referring more to the marketing margin part of it in terms of retail fuel margins, how they have behaved? And what are you seeing for the first quarter?
No, I'm saying the retail marketing margins are not -- they are sort of fixed, and they are not affected by the movement in the prices internationally. It is the refining margins, which get affected.
So we are -- so are we saying that the retail fuel margins have not changed at all in 1Q versus 4Q, sir?
No, I'm not saying beyond this.
We have our next question from Mr. S. Ramesh from Nirmal Bang.
The first question is, in terms of the investments you're making in your own CGD geographic areas as well as the JV, when do you see some critical mass in terms of the CNG and PNG volumes? And what are the kind of addition you expect in terms of your profits, say, 3 to 4 years down the line?
Are you talking about the CGD?
Yes, sir.
Yes, we -- the investments are on. And right now, we will not be able to tell you the time lines presently. But I would just like to mention that the projects are on stream, and they are moving according to the time lines, maybe a bit here and there. But otherwise, the -- since -- unless the projects are completed, we will not be able to tell you what exactly -- or how it is going to pan out.
Generally speaking, these CGD investments take CGD, actually, certification takes longer time, even PNGRB allows some years for completing the minimum work program, et cetera. So it will depend upon the time of sort of laying physically the infrastructure as well as the availability of the trunk line to reach gas to those geographical areas. So we are first concentrating on, say, CNG and sort of sourcing wherever possible, CNG through gaskets also, so that we can sort of capture such opportunities.
Okay. And the second thought is on the refining side, we hear that there are a lot of capacity closure and at the same time, there are refineries which are getting into petrochemical. So in terms of your own understanding of the numbers, what is the kind of closure of refining capacity you can share with us, say, over the next 1, 2 years? And how do you see the light or sweet/sour differentials moving given that there is an increase in the supply of OPEC and the Iranian crude?
So none of our capacity is getting closed, perhaps you are talking about some facilities world over. So...
We are talking about the global capacity, yes.
So we are also aware of such capacity closures only from media sources only. So I would not like to dwell upon that. None of our capacity at least is getting closed or in India, any capacity is getting closed. And regarding the demand and crack scenario, I answered a few moments back also. We see the demand to be very robust and the crack spreads also to be healthy enough. And based upon that only we are approving projects with a minimum hurdle rate.
Okay. One last, sir, in terms of the integration with petrochemicals, we're seeing pretty much all oil and refining companies looking at petrochemicals. So while there is growth in demand, is there a risk that there will be excess capacity somewhere down the line? And remember, your feedstock cost economics may actually bring down the cost of production. Isn't there a risk that spreads will fall and would jeopardize the returns from these projects? What are your thoughts on that?
No. Based on our studies, whether in-house or through consultants, we see the demand in absolute terms also growing and our expansions will support that demand. Though the market share of the petroleum fuels may go down in long run but perhaps, the absolute volumes will keep growing. And hence, accordingly, we are going ahead with our expansion plans.
No, I was referring to the petrochemicals business. If you see oil companies and refining companies are all trying to capture the petrochemical value. So when you see everybody putting up these projects, assuming -- even if we assume that there is growth in demand, isn't there a risk of excess supply by...
Definitely not. India is still -- India's average consumption is much, much lower than the world average. And there is a huge potential for growth in the petrochemical demand in the country.
We have our next question from Mr. Sumeet Rohra from Smartsun Capital PTE Limited.
Sir, firstly, I would like to congratulate you on fantastic set of results. You have done a remarkable performance in such a challenging and tough year. And also, on a positive front, I would like to wish the entire IOC team to please be safe, to take care and to be healthy. Sir secondly, now coming to my question, sir. One, I would like to ask you that you mentioned you added 3,000 outlets. So sir, is that basically -- are we going to add 3,000 outlets every year? Or we've added this as a onetime? Sir, secondly, I would also like to highlight to you that IOC is truly a gold mine. And the reason I use this is because you have a dividend yield of 11.5%, you have a 23% earnings yield. No company in Nifty, no company in India has this kind of financial metrics, okay?n I would like to say this on record that you are actually one of the best companies India has ever produced. But sir, unfortunately, this is not translating into a market cap phenomena. So if you see after reporting the record performance you have reported yesterday, in spite of that, today, the market is not seeming to give it a thumbs up, which is absolutely ironical and strange. So sir, I would really wish and I would request that the IOC Board must seriously consider value unlocking themes because this company is definitely not worth lower than BPCL's market cap. Today, sir, BPCL's market cap is equal to our market cap, okay, but we are 2.5x of our peer. So I would seriously request if some kind of value unlocking happens in terms of some division is hiked off or something, I mean, that is something which obviously is missing. So I would seriously recommend if that is looked into. Because ultimately, this is government of India wealth. Sir, secondly, coming to the point is on the crude point of view, I get to understand that there have been some flashes on Bloomberg today that Iran may come back into the oil market. So will that actually be beneficial to IOC? So will we start buying crude from Iran? And if yes, then -- does Iran give at some kind of discount to our company?
So first, on the retails outlets. So yes, we have this plan going forward also, at least in the near years because we feel that somehow we have not put up enough retail outlets compared to our market share. So we will be putting these ROs. And this does not -- we operate in various models, A site RO, B site RO. So not much of a concern on the number of ROs. Second, on the market cap, I take your suggestions for consideration. Thank you very much. But on a lighter note, the market depends -- the IOC share price depends upon the -- your analysis and your feedbacks. But you must also appreciate that even yesterday and even today, the market is in red. And despite that, IOC share is performing. So I think that is a good sign. What was last?
Iran crude.
Iran. On Iran crude...
Sir -- Iran, yes, sir.
On Iran crude, we were buying Iran crude earlier also before sections and -- before sanction, and I do not have any doubt why we will not buy Iran crude because that favors Indian refining system also, if the sanctions are lifted. So we will definitely buy. As far as commercial terms are considered, since there was a considerable gap in between, we will have to see how -- what kind of commercial arrangements are made with the National Iran Company, which supplies the crude, once it is to restart. Perhaps it is too premature to comment about that at this stage.
Sure, sir. Sir, just one thing, if I may ask, if I heard you correctly, you said that the total outstanding of government receivables is only INR 680 crores. That's what you said, right?
Yes, I repeat, it is only INR 680 crores.
We have Mr. Vidyadhar Ginde back on the call.
Yes, can you hear me?
Yes.
My question was on petchemicals. So could you give us some guidance on possible volumes of petchem in FY '22? And what is specifically on the PP side because I think most other products are operating at high levels, except for PX/PTA, which you mentioned. So PP is the one where you were talking about sourcing propylene to bump up your capacity utilization. So if you could give us some indication on that for FY '22?
So presently, the PP Paradip is operating at about 60% to 65% capacity levels in April and May and we are trying to ramp up this capacity, but that will depend upon the feasibility of importing the feed for which we are trying. Beyond that, only MEG plant will commission during the year at Paradip, and there are a lot of other projects which are in stream and which will take perhaps a couple of years to get commissioned and then start producing. But as a guidance, I can tell you that our plan is to take our petrochemical integration ratio to about 14% to 15% by 2030.
We have our next question from Mr. Maulik Patel from Equirus Securities.
Can you just share the progress in terms of volume at Ennore? And what is your expectation on the ramp-up?
Yes, just a minute. It was 2.72 MMTPA.
So that's roughly around 0.9 million tonnes, right? This is -- we're talking about for the full year or the quarter, sir?
I talked about April '21 level.
April '21, current level.
Maybe the full year figures, I will give you separately. I do not have immediately.
Thank you. I would now like to hand over the call to Mr. Harshraj Aggarwal. Please go ahead, sir.
I would like to thank everyone and the management for taking time to attend the call. Thank you, everyone.
Thank you. Thank you very much.
Thank you. Thank you from Indian Oil side, and thank you to everyone for taking attending this conference.
Thank you, sir. Ladies and gentlemen, this concludes your conference for today. We thank you for your participation and for using iJunxion conference service. You may please disconnect your lines now. Thank you, and have a great day.