Shares of Mangalore Refinery and Petrochemicals Limited (MRPL) saw a surge of over 2.7% in the early trading hours today, reaching Rs 106.30 by noon. This rise marks a 2.5% increase from the closing price of Rs 103.51 on Tuesday.
The uptick followed the company’s Q2 results announcement, which revealed a shift from a net loss to profit. Despite a decrease in operational revenue for Q3 2023 to Rs 22,844 crore from Rs 28,453 crore in the previous fiscal year, MRPL reported a profit after tax of Rs 1,059 crore. This is a notable improvement from last year’s net loss of Rs 1,789 crore.
In addition to this, MRPL’s EBITDA saw a significant rise to Rs 2,213 crore from a negative Rs 1,963 in the prior fiscal year. However, both EBITDA and net profit fell short of their respective estimates of Rs 4,380 crore and Rs 2,890 crore due to higher forex losses.
Despite the positive performance in terms of profitability, Motilal Oswal analysts issued a ‘neutral’ rating to MRPL’s stock. The rating was influenced by lower than anticipated refining throughput and forex losses. The refining throughput for the quarter was reported at 3.2 million tonnes against an estimated 4.3 mmt, marking a YoY decrease of 19%.
The financial performance of MRPL this quarter highlights its ability to return to profitability despite challenges like forex losses and lower refining throughput. The market response today indicates investor confidence in the company’s turnaround strategy, even as analysts maintain a cautious stance due to ongoing operational challenges.
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