InvestorQ : Do you see the stock of MRPL and Chennai Petro rallying further from here?
vaishnavi mhatre made post

Do you see the stock of MRPL and Chennai Petro rallying further from here?

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vidhya Laxmi answered.
4 weeks ago
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The market saw a sustained rally in the stocks of MRPL and CPCL with both the stocks touching multi-year highs. While MRPL is up 3-fold since the start of 2022, CPCL is up nearly 4 fold since the start of 2022. That is largely because most of the refineries are in a sweet spot currently after the Singapore benchmark Gross Refining Margins (GRMs) has spiked to $25.2/bbl. This is amidst a global shortfall in refining capacity.

The spike in the GRMs has been pretty sharp. The GRMs were just $8/bbl in the March 2022 quarter and it was as low as $2/bbl one year back in June 2021. This trend has benefited the pure refiners like MRPL and CPCL more than the integrated players. That is because, in the case of players like BPCL and IOCL, what they could have gained on refining margins, they have lost out on marketing margins as the prices of petrol and diesel are static.

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