Thanks, Kathy. Good afternoon, ladies and gentlemen. On behalf of Bhakti and Ankani, it gives us the pleasure to post the management of Indianoin Corporation for this one year 21 course level conference call. Without much ado, I would now like to hand over the proceedings to the management of the company for the initial remarks, after which we will conduct a look forward to your Q and A question. Over to you, sir.
Thank you, Mr. Kavin. We welcome you to quarterly earnings call. From management side, we have Mr. Sanjit Kumar Gupta, Director of Finance, Indian Oil Mr.
Matthew Thomas, Executive Director, Corporate Finance and Treasury. Along with them, we have Mr. Prahad Himans Singhal, GGM Treasury and myself, Raghinash Singhal, Lease Manager, Treasury. To begin with, Director of Finance will briefly touch upon the performance highlights for the quarter gone by. Thereafter, we will take questions from your side.
I would now request Director of Finance to address the meeting.
Dear investors and analysts, a very good afternoon to all of you. At the outset, I pray that all of you are safe and remain safe and sound. I take this opportunity to welcome all of you to this conference call post announcement of the first quarterly results for 2021. I believe you would have gone through the accounts posted on the website and also through the updates sent to you. I would still like to briefly dwell on the results to provide additional clarity and insights.
Highlights first. First, before going to the numbers, I would like to touch upon the impact of COVID-nineteen on business operations of the company during June and July 2023. Refineries ran closer to full capacity in the month of June 2020 and the capacity utilization was at about 97%. In the month of July 2020, the average utilization though fell to about 90% because of the lower demand primarily. For gasoline, in June, the demand was at about 85% of last year's volume.
It has further improved to about 89% of the last year's volume in the month of July. The preference for personal mobility seems to be helping in sustaining the demand for gasoline despite reimposition of lockdowns in certain parts of the country. On the gas oil front, sales stood at about 82 percent of the last year sales in the month of July and have dropped to about 77% of the previous year sales in the month of July. The slowdown in gas oil demand is primarily driven by the monsoons in addition to the lockdowns in some parts during July. ETF continues to take the hardest hit with sales being only 35% in June and it continued to be on similar levels in July.
With the gradual lifting and lockdown restriction, several downstream industries in the petrochemical sector have resumed operations from late April '20. Indian oil's naphtha cracker at Panipat operated at full capacity during June and July along with downstream units for production of polypropylene at EP, LLDP and MEG. The lab unit at Kwale Refinery continued to operate at full capacity. The polypropylene plant at Paradek Refinery operated at about 50% in the month of July. Now let me briefly touch upon the performance of major verticals during Q1.
First refineries, The throughput during the quarter was at 12,930,000 metric tons with a capacity utilization of 74.4%. The throughputs were severely impacted in April and May due to lower demand for finished products. During Q1, distillate yield was 78.3% and fair and loss was at 10.9%. Much lower throughput than the design capacity in the months of April and May has led to deterioration in the above performance parameters in comparison to previous quarters. IOCL refineries have registered a negative GRM of $1.98 per barrel during the first quarter.
Though the normalized GRM suffered stripping off inventory impact and manufacturing in price lags for the quarter is positive $4.27 per barrel. As against benchmark Singapore GRMs of negative $0.94 per barrel during Q1. In refineries, there is an inventory loss of INR4580H crore also. Coming to pipelines, the capacity utilization of our pipelines was about 53.53% during this quarter as compared to 88% in the Q4 of financial year twenty nineteen-twenty twenty. Impact of crude related disruptions on demand resulted in lower utilization of both crude as well as product pipelines during the quarter.
Our pipelines continued to generate stable returns giving an EBITDA of about INR $11.50 crore during this quarter, which is lower than the preceding quarter due to lower throughputs. Coming to marketing, the petroleum products sales during this quarter was 15,480,000 metric tons as compared to 20,640,000 metric tons in the preceding quarter. Major products like gasoline and gas oil recorded a negative growth rate of about 35% each, whereas ATA volume key growth was closer to 18%. The bulk of ticket on demand was there in the months of April and May. Marketing division recorded an EBITDA of about INR 7,700 crore during April to June 2020.
This includes an inventory gain of INR $13.92 crore. Excluding inventory gains, the marketing EBITDA stood at about INR 6,300 crore. In petrochemicals, during the quarter, we reported an EBITDA of INR $7.28 crore as against INR $4.75 crore in the previous quarter. The EBITDA for corresponding period of last year that is Q1 financial year 'nineteen-'twenty was INR $6.86 crore. Improvement in polymer, MBG as well as PGA spreads during the quarter helped the company negating impact of lower sales volume during the quarter.
On borrowings front, borrowings as on 06/30/2020 were INR9865 crore as against INR166545 crore as on March 31. The above includes lease obligation of INR 7,749 crore as on thirtieth June twenty three, which has been classified as borrowings. I will end my briefing here. We will now take your questions. Thank you very much.
Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press star and one on your telephone keypad and wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing star and one again. I repeat, ladies and gentlemen, if you have a question, please press star and one on your telephone keypad.
First question comes from Aishwarya Agarwal from Equon India. Please go ahead.
Just help us about the expanding inventory losses which we have. So I remember last quarter, we have some $37,800 kind of valuation for inventory. And I was expecting some meaningful inventory gains over the crude is at 43 whereas the result was otherwise. It is at work. Yes, the accounting guidelines, as you would know, does not allow us to book the gains, which are there because of the uptick in the price limits.
We had procured our inventories, crude oil, raw materials at lower than the thirty first March valuation price also during the month of February. And that is what we're getting reflected in the inventory losses during the quarter. As you would know, unlike other postal refineries, IOC has most of these refineries inland in inside locations. And it takes long time to bring that crude oil from the source country to the refineries for processing and then say,
give it
back to the marketing locations for sales. So now while this all resulted into inventory loss in this period, we have now accrued lot at much cheaper prices subsequently in April and May. And going forward, we can hope of some inventory gains. So what valuations are there for the second quarter when it comes to crude? The crude is valued at $32.64 per barrel as of June 30.
And will I be right to assume that the current prices are between $32 to $44 So, if prices hold on, then we will be valuing it at these prices, like $40 around? This crude whatever we are having at about say $30 to $33 at the June will be converted into the products and the products will be sold at the debt prevailing prices. So, if these prices remain high, we will have gains. If these prices again crash, we may have losses. Sure, that's very helpful sir.
And one last question is, coming to the, if I look at the EBITDA number and if I look at the way the CapEx are happening in the last two three years, so ranging against 75,000 to 30,000 crores, I don't see that some increase in EBITDA happening. Though the refining is reached, agree. But, I mean, if the entire everything is going to refining or what, I mean, whatever difference in India, that is more benefits are coming
in that
number. So large amounts of the CapEx, which was done in the last years was also because of the GS-six projects, which were on the survival of the refineries, essentially, because of the change in primarily. In this year, COVID has played down on the EBITDA. So definitely, I agree with you that the investments have happened in refinery and it has not given commensurate results, But it was because of exchange was results and is definitely not driven by the performance. Even for seventh year also, we have done 26,700.0 crores of KT and again, I don't know how much we get to take.
I mean, we are doing so much. We are putting so much of money into the KPA. But how it will get protected or whether it will get reflected or not is is what is worrying about it. Definitely, it will be reflected. You know, any company and definitely of IOC size definitely approves the project based on its merit and based on the economic returns which are expected out of such projects.
If there are no extraneous reasons, these projects will definitely bring While some of the projects may be refinery linked, many of them are linked to the pipelines and marketing installations and LPG filling plants and other things. And definitely these go on to reduce my logistic costs and other operating costs also. Thank you.
Thank you, sir. Next question comes from Nitin Tewari from Antic Stock Broking. Please go ahead.
Good afternoon, sir. Thanks for taking my question. I hope I'm audible. Hello? Yes.
You are audible. Please go ahead. Yes. No, sir. Sir, my question is again on inventory loss, sir, to start with.
Just staying on that topic, you just mentioned that if prices go up, you can't book inventory gain. So if you can just help us elaborate, help us understand that and elaborate a little bit more on that because, actually, when you spoke in past quarter, you did mention something around net realizable value where we consider the value of products for valiant inventory. So we did just understand the process of inventory calculation for once. And secondly, again, related to inventory itself, what is the number of days of inventory that we carry on group side and on the marketing side, if you can just also then I'll ask you. The inventory losses would happen if there is a drop in the prices and inventory gains will happen if there is an increase in the price levels.
Now, as I mentioned earlier the earlier to the earlier question, we had certain inventories as of March 31. Subsequently, the prices have dropped further. And while we procured our raw materials at lower prices, the sales realization was also at the correspondingly lower prices. And a part of that, whatever was accountable was accounted on March 31 and well has got accounted in this quarter. Now going ahead, there is a rise in the prices subsequently as against the lower price crude, which is available now at say about $32 or $33 per barrel.
And if it is sold corresponding to the present crude cost, then we are under our steps to recover certain inventory gains in the coming quarters. Great, sir. But in March, we did mention that capital was based on net realizable value as of April 15. Correct me if I'm wrong over there because I believe it was also mentioned that had we stuck to the values of thirty first March, the inventory losses would have been higher. So we had moved to basically calculation of on the basis of net realizable value and compared the two.
So so is this calculation based on the July 15 or as of June 31, and it's based on growth price or, like value of products like inventory I mean refinery gas products? The valuation of inventory for crude for products, in any case, it has to be benchmarked with the product realization only. But for crude oil also, we have to see what is our cost of crude oil on a particular trade and have to compare it with the realizable value of the products, which it will produce out of that which we will produce out of that property. So accordingly, was based on best estimate what was available till we closed our accounts for March 31. And whatever subsequently on June 30, whatever balance was there, balance was there, that is reflected in the inventory losses for this quarter.
Sir, and the number of inventory days that you are carrying for crude and for marketing? Well, for this period, it may be a little skewed because the sales are down. We generally used to carry about forty five, forty six days of crude inventory, and it is a little higher at this point in time, not in terms of the absolute number, but in terms of the number of series. Right. And from marketing, how many days, product inventory?
Product inventory, again, we used to maintain about fifteen days stock for products. Corresponding to the current level of sales, naturally, the number of sales, it is appearing at a higher level. Great. Sir, second question is related to CapEx. Again, as you mentioned that it's not some amount of CapEx is going into marketing infra and pipeline.
So one, if we can have a breakup of CapEx numbers. And second, you know, we have a a number of fuel stations. So at some level, are you looking at digitalization of this network infrastructure in in ways that it is more efficient rather than going ahead into adding basically outlets to our network. So what's the thought process over there? Are we going to continue adding outlets or are we going to take, you know, take a pause right now?
That that would be nice. So first CapEx, Mr. Matthew, if you can go ahead. You want to know the CapEx levels of this year? We are planning to I mean, our plans today, as of today is, we would be spending close to INR26000 crores during the year, which comprises around INR4000 crores for refineries, equal amount between pipelines, INR5000 crores for the marketing and petrochemicals would be close to INR 2,200 crores.
There will be some for our R and D and for investments in JVs and so on and so forth. So I mean most of the expenses in refineries would be related to the BS VI, which will I mean the spillover of the BS VI expenses, which will happen this year. And in pipelines, of course, have got with the Noor Madurai, which we bought in our LNG pipeline and the Faraday Hyderabad pipeline is on. And we've also got in marketing, we've got the new cylinders and pressure regulators. There'll be modernization of refill outlets also and at the same time, we've got construction of refill outlets too.
And there will be some terminals and we are postponing it with construction as well as revamp. And not to talk about the bottling plants, we think they will be having some construction and revamp. So and an NPD import facility and Paragit online Kochi. So these are comprising for marketing. And Telkam, of course, the MEG project in the Paradeep and the will be some expenditure over there.
We'll have a bit of expenditure and other expansions in Manipat. So these are mainly the broad classification of CapEx throughout the year. And we have also earmarked some for possible assets. Of course, 6,000 contain something for possible assets and all. And they are all possible If we find some good assets, then only we'll invest that, others we won't.
Otherwise, we won't invest. So that's having our strategy all through, and we continue to do that strategy. So as of date, I may repeat my words, as of date, the plans stand as of date. As we move forward and as the events unfold, things can be different, ground realities can be different. But as on date, this is what we are about.
This is with respect to CapEx. Now coming with across to the retail. On CapEx also, I want to further add that out of this INR26000 crores of CapEx, about INR5000 crores is in respect of our group companies, in which also again about say 1,100 is in respect of our RPCL, which I do not know what will be the progress because it depends upon the land issue being solved. And some portion say about INR800 crores is on HURL and other things. But as we can give breakup which Matthew has given, you can see that in refineries there is an investment of only about INR4200 crore And the greater investments are there in pipelines and marketing and petchem, which we feel the petchem definitely is a profitable segment.
And refineries and pipeline sorry, pipelines and marketing investments are towards reduction of mine logistics and operating costs. So we believe that the benefits will flow out of these CapEx numbers. And your next question was on the outflows. So, while we have a very ambitious plan of RO network expansion, but not necessarily all ROs will come in the A side category and there may be many ROs which will come in the B side category where the investment by the company is very minimal. So that is a factor of our marketing strategy and we will not be able to divulge anything further on this at this point in time.
Sure. Thanks for taking my questions.
Thank you, sir. Next question comes from Ravi Agarwal from UTI. Please go ahead.
Good afternoon, sir. Sir, my question is written around the valuation gains and losses. So basically, I'm not wrong sir, if I can just get to know what was the valuation which was done on March 31 and the inventory and what was the valuation for July 21 for valuing the clearing stock? Yes. As I mentioned, the valuation is based upon the principle of cost or net realizable value, whichever is lower.
So we continue to value our inventories consistently on this practice. As earlier said, while the evaluation of say raw material inventory was at about $36 $37 per barrel as of March 31, it is of your at about $32 to $33 per barrel as on June 30. So basically, Ankit, if my calculation was correct, so $3 is what this closing inventory? And as you said that your cost of procurement in April and May or May, interest rate was very low, at around $50 to $52 which you said. So that was and that was valued at around the same level.
So basically, is that the reason? I mean, the opening stock was around $33 and closing valuation was around $30 something like that. Is this the expectation? No, I couldn't get your question, Kashyiri. So it was a Yes, long yes, I'll repeat.
So if you have valued inventory at $32 $33 a barrel for July 31, This has resulted in a inventory loss. So basically, what was the so wasn't the price around the 30 to $33 the entire quarter? I mean, I'm just trying to get the reason for the inventory loss of around Actually, $45.37 dollars as of March 31 and is at $32 to $33 per barrel as on June 30, not July 31, June 30. This reduction in the value of inventory is because we value at cost of net realizable value, whichever is lower. So even if the net realizable value is higher, if we have carrying if we are carrying inventory at a lower value, we will have to value that inventory at a lower level.
And this reduction during a period is termed as inventory loss. While we are holding a set amount of say it's about 15,000,000 to 17,000,000 tonne of hydrocarbon inventory, we keep at any one point in time, if the value of that inventory in international market goes down, so that will get reflected in the inventory losses. All right. And can we expect a further increase in core GR and some of the lower procurement as it improves during the third quarter? I would say it is not core GRs will not go up, but yes, we will get we are set to gain some as inventory gains, because we would be selling our products at a higher price as compared to the price of crude at which it was bought.
So, we will we are set to register certain inventory gains going ahead. While the core TRMs, we are going to remain sort of subdued, which are linked to the cracks which are there in the international market.
Okay. Thank you very much, sir.
Thank you, sir. Next question comes from Chinmayi Ghansi from Bharti Axa. Please go ahead.
I'll not be able to give this information product wise. We have already given you the marketing segment information. Sir, So as far as marketing is concerned, the marketing margins product wise, product to product also are going on as per the regular philosophy. So they are active.
Okay. So even in like slow times, I mean, when lockdown was there and
COVID has impacted the sales also.
Yes, volume is okay. Am sorry,
it was okay.
Just regarding, I mean, has been discussed for several few times. Regarding the inventory loss, which you meant basically, then you will have again because your cost that. Right?
Yeah. I believe you have understood correctly.
Yeah. And but, normally,
Not for the full quarter. Not for the full quarter. Yes. Because giving the inventory in terms of number of days sales is very tricky in these times, actually. We do not know how the thing unfolds going forward.
Yeah.
Yeah. Thank you.
Thank you, sir. Participants have kindly requested to restrict with two questions in the initial round. Next question comes from Sumeet Rora from SmartSun Capital. Please go ahead.
Sir, I just want to understand how many fuel outlets do we have currently? And how many outlets are we looking to add in this financial year? The reason I ask you, sir, is because there was an international deal which happened yesterday, wherein Marathon Petroleum sold its three way fuel outlets, 3,900 outlets for $21,000,000,000 I'm very confident that marketing is a very precious business since it's normally recognized by markets today, but it will be going ahead. So can you just share some light on basically our fuel outlets today and how do you expect the fuel in the next couple of years?
Currently, it is about little more than 29,000 retail outlets. And this could involve various category of retail outlets like Bluetooth, city outlets, highway outlets, rural outlets. And going back the past trend, I think we would be adding more than 1,000 ktl of fleet per year, but that would also depend on like various strategies in place.
Sir. So I I think going into the I mean, the integrity of the numbers may not be appropriate right now. Concept that the finance was mentioning was that we would certainly like to strengthen our marketing because they are giving steady returns to us and only steady returns from a competition point of view also. So certainly, we'll be strengthening those segments that we have earmarked money for investments in those sectors, be it modernization of rental outlets or increasing the number of retail outlets. Both will be done throughout the year.
And that's one of the strategies that we call and we continue to do
that. Okay. Understood. That's fantastic. Thank you, sir.
Thank you so much.
Thank you, sir. Next question comes from Amit Rastigi from UBS. Sir,
first, of all, my question is we had been saying that when Saralid refinery gets over, our CapEx will decline. But still, we are consistently maintaining like INR 25,000 crores, 36,000 crores of CapEx every year. So don't you think that we need to take calls here and rethink about our strategy and maybe refurbish our on the projects, which we should take and maybe sharpen the skills here? Because we have not been able to add any value by completing these projects. As I replied to an earlier question, our FX is evenly spread in various segments.
So there is some FX in refineries, some in pipeline, some in marketing, some in gas, some in petrochemicals, some in our job growth companies. So we are not having an overhang in any particular segment. It is heavily spread. And these all investments are approved based on their own merits due diligence if they are expected to generate a particular kind of return. So we believe that whatever projects are ongoing must continue.
We have reviewed that also. And those projects must continue because those projects, say, far as pipelines are concerned, they will go to reduce my logistics costs without any say impact on my end fill price. So similarly, if we are putting up some terminals or other plants, LPG plants etcetera, that is also for the purpose of reduction of logistics cost as well as the operating cost. So there is a value in all these investments and we are expected to get benefit out of these investments. You have been taking the name of R and D refinery time and again actually, you will.
But definitely a project of this size does take some time to actually give adequate returns. And we have very ambitious expectations from the Paragip refinery project also. Sir, so don't you think that in the given environment where the challenges and uncertainty prevails, we should keep pause on the CapEx plans going ahead? Or you think that we'll keep on investing the way we have been investing in all the projects everywhere, every segment? Look, as I mentioned you, while our CapEx for in the earlier years for under refinery segment was for BS VI after the company, it was primarily for BS VI investments, which were in fact the question of survival because of the change in the specification of the oil.
Now going forward, we have a few expansions only like we have Baroni refinery expansion declared, no other expansion has yet been approved. So that expansion is also to take care of the future demand. Now this project was announced when COVID was not there. After COVID has impacted the demand globally and for the country also, we have been very carefully examining whether we should go with further capacity expansion or not. As far as our other CapEx is concerned, it is in this, say, field of say pipelines or marketing or gas or petrochemicals.
Now if we do not do these investments, then we lose on the potential of margins from gas business or petrochemical business, which are definitely high margin businesses and futuristic businesses. If we do not invest in pipelines, we lose on logistics costs. If we do not put up investments in marketing terminals and bottling plants etcetera, we lose on the potential volumes also. LPG consumption, you can see that despite COVID, LPG consumption went up. So we are we feel that whatever investment plans we have as on the base, they are all justified and we are not resolved.
And we must carry on this CapEx program. Definitely, your concern is our concern also. We are being very, very careful in embarking upon any future project. We have recently announced the XPT project at Parliamentary Finance, but that again is a more traditional project, which we feel is would be profitable. And we have also announced the North East gas grid, which is a futuristic gas project.
So we are also being very careful in investing any major amount for a sector where the demand will get impacted in future. And sir, my second question relates to the opening of CGD by the regulator CNGRG. So currently, we are selling gas through our station, but they are branded like IGM stations and Mahanagir gas stations. So do you think to enter this market when the regulator brings open access in the existing CGD? Do you have any plans for this business as well?
It will not be appropriate for me to disclose the plans because this is a recorded call. But definitely, we will have certain strategy in these fields. Both the guidelines are yet to be notified. Yes, guidelines are yet to be notified. Do we have any plans for the gas business per se for IOC from like maybe five to seven years to six years?
You know we have very aggressively built in the CGT projects. We have 17 of our own, 23 in joint venture. We have all PGAs with us going forward also. So, yes, we have definitely chosen as a future business segment where we want to expand. Okay.
Thank you, Thank
you, sir. Participants are kindly requested you to stick with two questions in the initial round, and please join back the queue for further questions. The next question comes from from NT Global. Please go ahead.
Good afternoon, sir. I will go back to the inventory question once again. So I just have a clarification. Your sister company, Chennai Petroleum, reported around $12 of GRM and you reported minus $2 GRM. So the difference was mostly because of this inventory gain, which we have received versus the loss.
So that's the difference only because of the fact that NET Petroleum is a coastal refiner and you are mostly Indian. That is the only reason why the difference was there between their equipment and their equipment?
I believe so. That is what I mentioned in my opening remark also, perhaps to the answer of one of the earlier questions that the cost of the refineries could clock the inventory gain very fast.
IOC being
located IOC refineries located in the inter land would take some time to book the gains and you can expect that in the coming months.
Right. So, it will be probably at a few, few months left, so it will come in Q2. Okay. And second, I have a few good checking questions.
$50,075,000 crores.
5,000 crores and how many retail outlet addition you have stated?
In the pipeline 4,571 crore of CapEx in the current year, which also includes the gas RLNG pipeline of INR 2,571
crore, okay. Yeah. Okay, sir. And how many retail outlets you are planning to add every year, I'll make it actually around 1,000?
Vinad mentioned earlier, we have plans of putting up every year we have been putting up about 100,000 outlets and that program continues.
And how many of the total out of 29,000 outlets, how much is cooked outlets emerges?
We do not have a figure right now.
Any ballpark number around 5% range from company sir?
Our team will give you subsequently.
Okay. And sir, just one last question is that debt, you had mentioned that around INR7700 crores was the lease liability, is that right sir?
Yes.
And what about government subsidy outstanding, any breakup on the date and do you expect it to fall further from this INR98000 crores going forward?
This amount includes a government outstanding of INR 11,080 crore as of June 30, which has now dropped to INR 9,100 crore as on date. And every month now that the LPG and currency subsidy are practically not there at the current price levels, international price levels, we are expected to liquidate this particular GY outstanding every month going ahead.
Sir, $360 per metric ton, Arabdol for LCP you don't expect any HDD, DTM subsidy also.
So, if this price level continues, there will there is not going to be any subsidy involved. So, our GEO ADOs will only reduce.
So, we should be around 90,000 if we are able to like generate enough cash to meet the CapEx for this year, right?
I could get you.
Sir, we should be calling back around 90,000 crores kind of growth, unless of course our free cash flow is negative because of delay in earning free salary.
Yes. I think you can expect.
Thank you so much and all the best.
Next question comes from Mayank Maheshwari from Morgan Stanley.
I had two questions. First was regarding I think you had taken some new initiatives on the new energy side specifically coming in on the battery swapping as such. Can you just kind of highlight your long term plans and the CapEx you're kind of thinking about on that front?
We want to be present in every segment of EV short of vehicle per se. And we have plans for the technology. So we are working on various kind of chemistries for battery technology. We have international collaboration also on that and our R and D is also working on that. Then we have plans for battery swapping.
We have plans, we already are putting up EV stations, EV charging stations. We have also plans of manufacturing the factory domestically using one of the accepted technologies. So we have very ambitious plan on for this segment.
Sir, how much would you be kind of spending in terms of CapEx around this for this year or even going forward? Is there something you can give us some idea about or what is the investment you're planning on this?
While the present investment may not be very significant in this particular segment for the current year, in future we will have to plan out our strategy depending upon how the things make progress, because the chemistry also an acceptable chemistry of which we should also be decided upon. And based on that, we will have the plans in the future years.
Okay. So for this year itself, like, if you kind of think about second half of this year, is there any plans, like how many stations or how many retail outlets would you be offering this either EV charging or battery swapping? Is that something that you have in your mind?
We will provide you this information subsequently.
So the second question was more related to the PX, PTF plan that you were talking about earlier. You're spending about $2,000,000,000 on this, and I think there is massive oversupply on the PX side in at least globally for the next multiple years. So can you just help us kind of understand what has gone into the investment decision to kind of go ahead with this PXPG and if not any other chemical?
While there may be a global oversupply as of now, but going forward, we have anticipated that there will be a demand at least domestically. And while as on date, is no guarantee, it was revoked. But we are also confident that dumping perhaps would be able to take place. So we feel that this project is going to give us, say, ahead some returns. And any specific reason to just go ahead with this part of the value chain in petrol controls, not any other part?
No, we are also going on other parts like Gujarat, you mentioned earlier we went for OXO Alcohol. So it is not that we are only looking on a particular product for our projects. So we are sort of diversifying and we have done our robust study and we are confident that this project is of value. Okay. Thank you.
Thank you, sir. Next question comes from Vijayadagar Jainai from ICHA Securities. Please go ahead.
Yeah. Thank you. So my first question is in case of SDG, in the past, you used to have this some which were uncompensated. I presume that is now completely gone with also gone. So are you willing to recover all that and are you making some marketing margins on LPG?
Would not be able to go into that detail on this call. But as mentioned earlier, our marketing margins on LPG also continue to be. Continue to be? Yes sir.
Okay, so but they are positive, they are non negative?
Definitely not.
Yes, okay. And sir, can the second one is regarding the as far as your CMBS and mentioned the prices saying like utilization by the end of from onefour thousand $7.75. Is it because of Faraday shutdown and should we expect that kind of utilization until Faraday restarts?
No. No. Paragip, thing is only for a couple of weeks.
Yeah. So during that time, will you be at that level and then again come back?
No. No. What he mentioned was a long term, perhaps it is I would not say long term, but for, say, balance of the year. So it was Paradeep, as I said, the Paradeep shutdown is only for a couple of weeks. We are with the kind of, say, lockdowns which are happening and the second wave of coronavirus globally coming, we have certain appreciations of the on the volumes going forward.
And though nobody can say for sure what is going to be national levels in India or worldwide. Yes. We expect that it may not be, say, back to normal situation, maybe in another six to nine months.
Okay, okay. Any idea you could give us on what were the exit rates on diesel and petrol consumption for July? And I think you gave us the average for the a month of that what was the
average exact rate of petrol and diesel consumption in July? So you gave us average for the month that petrol was 89 and diesel was 77.
So by end of month, were we worse off similar?
Yes. I I mentioned during my opening remark on So for this, we gave you you are talking July numbers? No. No. Actually, July, you gave
us a number. You said that July, the I was asking whether end July was similar to average July or it was better or worse is the question. I'm I'm trying to get some idea on August.
No. Our team will give you info this information, sir.
Okay. No. Thanks a lot. Thank you. That's it for me.
Thank you, sir. Next question comes from Pinakin Pare from JPMorgan. Please go ahead. Mister Pinakin Pare, please go ahead with your question.
Yeah. Thank you very much. Sir, just my first question is on the retail fuel prices of diesel and petrol. And last time, the company had mentioned that the DS six costs are being captured. Sir, at this point of time, sir, given where retail prices are and retail fuel margins are, are the entire BS related costs already been captured?
Or in your view, we need to see further license prices to capture whatever the IRR that the company was working on the BS VI investments? This was confirmed during the last call call also, and we reiterate that whatever was expected has already been filled in. And it's been filled over here. Sure. And sir, my second question is that when we just move to the CapEx number, and maybe I missed it, you have mentioned it earlier, what would be the stand alone CapEx in IOCL excluding the group companies?
And given the restrictions that you are, sir, what do you expect to incur this year if the restrictions are not yet paid on especially international travel in in the course not coming through? No. So out of total, about INR 26,000 crore, about INR 5,000 crore is for group company. For rest it's INR27000 for standalone RUCM. And we want to complete this CapEx because there is no point in deferring CapEx on a scheme, which is already approved by Board with due diligence.
So we will be sort of reducing its return if we defer it. So we are we want all these schemes to be taken up on priority and spend the entire 21,000 CapEx, which is planned for the current year. To what extent we will be able to do that given the circumstances of COVID related problems and the availability of workforce and work fronts that is to be seen. We are trying our best to complete this to spend this entire amount in. Understood.
Understood.
Thank you
very much, sir.
Thank you, sir. Next question comes from Manikanthabali from Access Capital. Please go ahead.
Thank you for taking my question, sir. I wanted to confirm what was the inventory level of you have mentioned as on June?
The
average amount of inventory food inventory that we had as on June 2020. You
are wanting volume or what? Quantity you want?
Yeah, quantity. Yes.
It's also about 8,000,000 tons.
Okay. What was the number you have mentioned, which is fifty, sixty to 70,000,000 tons of inventory, what that is including the product inventory also, is it?
That is what I'm saying. I'm giving you the data for crude. Our total inventory, total hydrocarbon inventory consists of crude, products, and intermediated stocks. Out of which, have given you the crude number.
Sure. Sir, my second question is similar to last phone call you mentioned that the cutoff date for calculating NRE is the quarter. Is it? What is the cutoff date for this quarter? The first one?
It is July 15.
Okay. Thank you, sir. That's fine.
Thank you so much, sir. That would be the last question for the day. Now I hand over the floor to mister Bavin Gandhi for closing comments.
Thank you, Bavin. I would like to thank management for providing us the opportunity to hold the call for them. Thank you so much, sir.
Thank you. Thank you. You for participating
in the call.
Thank you, sir. Ladies and gentlemen, this concludes your conference for today. Thank you for your participation and for using Blueshabad's conference call service. You may disconnect your lines now. Thank you, and have a pleasant evening.