HPCL Posts Record Profit of ₹17,258 Crore in FY26 Ahead of War Shock

Hindustan Petroleum Corporation Ltd (HPCL) on Wednesday reported a record net profit during the March quarter and the fiscal year ending March 31, aided by healthy marketing and refining margins before the full impact of the ongoing war-driven disruption in global energy markets hit earnings.

Standalone net profit in January-March -- the fourth and the final quarter of the 2025-26 fiscal year -- rose 46 per cent to Rs 4,901.50 crore from Rs 3,354.98 crore a year back, the company said in a stock exchange filing.

The record quarter profit came despite the company suffering huge losses on selling petrol, diesel and cooking gas LPG below cost in March as it, along with other state-owned fuel retailers, insulated the domestic market from volatility that hit the international market after the start of the West Asia conflict.

HPCL earned USD 8.79 on turning every barrel of crude oil into fuel during the quarter under review as compared to gross refining margin of USD 5.74 a barrel.

For FY26, the company posted a record net profit of Rs 17,175.23 crore, more than double of Rs 7,271.32 crore in the previous year.

The profit beat Rs 14,694 crore earning in 2023-24 fiscal year. That year, HPCL and other two state-owned fuel retailers, Indian Oil Corporation (IOC) and Bharat Petroleum Corporation Ltd (BPCL) posted record profit as retail fuel price freeze despite falling oil prices helped them post bumper margins.

Petrol and diesel prices have been on freeze since April 2022 and that status quo continued even after the West Asia conflict led to a 50 per cent surge in international oil prices. While the oil firms made handsome margins in FY24 when international rates were low, the scales have now tilted with a rise in international oil prices pushing them into losses.

On the earnings call with analysts, HPCL Chairman and Managing Director Vikas Kaushal said the current quarter (first quarter of the 2026-27 fiscal year) "is expected to be tough" and the company may post a loss in April-June.

April-June will be the first quarter when the full impact of the West Asia conflict will be witnessed.

The conflict started with the US and Israel attacking Iran on February 28, followed by Tehran's sweeping retaliation that shut the Strait of Hormuz, through which a bulk of India and the world's oil and gas supplies flowed.

"There will be losses in the first quarter... the situation is too volatile to give any sort of guidance," he said.

With tariff through the Strait of Hormuz halting supplies from traditional suppliers like Iraq, HPCL restarted buying oil from Russia, he said. Oil was also sourced from Africa, US and even Venezuela.

Kaushal said the company had to rely on spot or current market purchases after term or fixed quantity supplies from nations like Iraq got blocked.

In a press release, HPCL results for the quarter and year ended March 31, 2026 "reflects resilient refinery operations, sustained growth in market sales, healthy refining margins and continued progress in improving the company's financial strengths".

The fiscal year saw the highest-ever refinery throughput of 26.04 million tonnes in FY26 with 3 per cent increase year-on-year. It also saw steady growth in marketing with 3.3 per cent increase in sales volume in FY26 (51.45 million tonnes).

The Board of Directors has recommended a final dividend of Rs 19.25 per equity share. This final dividend is in addition to the interim dividend paid for FY26 at Rs 5.00 per equity share.

Refineries recorded crude throughput of 6.43 million tonnes in Q4 FY26.

"During the quarter, four new grades of crude oil were processed by the refineries, taking the total number of grades processed in the year to 52," the statement said.

HPCL said capex in FY26 was Rs 15,705 crore -- focused on strengthening refining and marketing infrastructure, including investments in subsidiaries and joint venture companies to build additional capacities, new business lines and improving operating efficiencies.

On the fire at the under-commissioning Rajasthan refinery, Kaushal said the restoration work is in progress and the commissioning cycle of the refinery shall commence in a couple of weeks.