BPCL Q2 profit slumps 22.5% as fuel price freeze erodes margins

Bharat Petroleum Corporation Ltd (BPCL), India's second-largest fuel retailer, reported a 22.5 per cent decline in standalone net profit for the July-September quarter, reflecting headwinds from a five-month freeze on retail fuel price revisions even as input costs continued to climb.

The company's net profit contracted to Rs 4,993 crore in Q2 FY2027 from Rs 6,443 crore in the corresponding quarter last year, according to its latest financial statement. While revenue from operations grew to Rs 1.58 lakh crore from Rs 1.22 lakh crore, Earnings Before Interest, Taxes, Depreciation and Amortisation fell nearly 14 per cent to Rs 9,437 crore from Rs 10,968 crore.

BPCL's refining operations posted stronger performance metrics during the quarter, with gross refining margins climbing to USD 32.53 per barrel from USD 10.78 a barrel in the year-ago period. The improvement reflected favourable crude differentials and refined product spreads in global markets. However, these operational gains were substantially offset by losses incurred through the extended freeze on domestic retail pricing.

The pricing freeze has created a mismatch between BPCL's rising procurement and operational costs and the fixed retail rates it can charge consumers, squeezing profitability across India's state-owned fuel distribution network. The company also reported a Rs 330 crore charge during the quarter related to the pricing constraints.