Several Indian lubricant companies reported strong increases in profits for the quarter ended June 30. Pricing actions enabled them to alleviate the impacts of several factors during the quarter – increases in crude oil and additive prices, along with inflation – Castrol India Ltd., Gulf Oil Lubricants India Ltd. and GP Petroleums Ltd. said in their earnings statements.
Sandeep Sangwan, Castrol India’s managing director, explained that the performance in the second quarter came in the backdrop of a volatile market environment where the company had to balance rising input costs, while maintaining an optimal price and volume mix. “We affected two price increases in the first half of the year, which enabled us to deliver a resilient performance and helped our business stay ahead of [the second quarter of 2021], though our volumes and margins were under pressure compared to” the first quarter of this year, Sangwan said in the company’s earnings press release.
“While there has been continuous pressure on input costs due to upward crude movement, additive price hikes, sharp [Indian rupee] depreciation and in general inflationary trend across all the cost items, the company has taken suitable pricing actions to minimize the impact” and helped by the better product and segment mix, delivered improved year-on-year margins, Gulf Oil Lubricants India Ltd. said in its earnings media release.
GP Petroleums CEO Prashanth Achar said the company’s improved profit for the quarter came in spite of a “totally hostile” environment. “The challenges are too many in the ecosystem – you address one concern, another challenge raises its hood,” he said in the company’s earnings press release. “We have passed on only a portion of the costs increase, and this is not sustainable in the long run.”
Castrol India, based in Mumbai, reported net profit of Rs 206.3 crore, a 47% jump from Rs 140 crore.
Revenue from operations surged 40% to Rs 1,241.7 crore, improving from Rs 889.56 crore.
Gulf Oil Lubricants India
Gulf Oil Lubricants India, a Hinduja Group company reported standalone net profit of Rs 55.3 crore for the quarter ended June 30, an 82% jump from Rs 30.4 crore.
Total income for the quarter was up 67% at Rs 715.7 crore. Net revenue – revenue from operations for the quarter rose 69% to Rs 706.5 crore.
All segments of the business achieved good growth, the company said, led by the business-to-consumer segment covering the bazaar market and original equipment manufacturer franchise workshops, with demand conditions improving in most categories on the back of such factors as improved business environment, and the impact of market reach and distribution initiatives.
Certain products, including diesel engine oil and passenger car engine oil, did particularly well during the quarter, said Ravi Chawla, managing director and CEO. “As the markets are fully open and operating near normal, post two years of pandemic, our theme is to ‘Re-establish Connect and Re-energize Growth’ by bringing back the personal touch at all levels and connect with all our stakeholders, coupled with the rolling out of extensive outreach programs to gain distribution and this quarter has already showed encouraging results on that front.,” Chawla said in the company’s earnings release.
GP Petroleums reported net profit of Rs 11.4 crore, improving from an Rs 4.8 crore loss.
Revenue from operations jumped 42% to Rs 220.1 crore, improving from Rs 155.3 crore.
Revenue for GP Petroleums’ manufacturing segment – including production and marketing of lubricants and increases – surged 60% to Rs 127.6 crore, up from Rs 79.7 crore.
Savita Oil Technologies
Mumbai-based Savita – supplier of transformer oils, white oils, lubricants and other products – reported net profit of Rs 87.8 crore for the quarter, a 13% increase from Rs. 77.5 crore.
Total income for the quarter reached Rs 875.7 crore, a 43% jump from Rs 613 crore.
The company’s revenue from petroleum products rose 45% to Rs 863.3 crore, up from Rs 595.8 crore.
“The growth in total income was driven by a combination of volume as well as price uptick across both petroleum specialty oils as well as lubricating oils,” Chairman and Managing Director Gautam N. Mehra said in the company’s earnings presentation.
Balmer Lawrie’s greases and lubricants segment reported operating profit of Rs 12.3 crore, a 66% jump from Rs 7.4 crore.
Net sales for the company’s grease and lubricants segment surged 48% to Rs 167.2 crore, improving from Rs 112.9 crore.
Indian lubricants blender Maximus International Ltd. reported consolidated net profit of Rs 2.1 crore, a 91% jump.
The company, based in Vadodara, Gujarat, said its revenue from operations reached Rs 22.3 crore in the quarter, a 19% increase.
Lubricant and grease seller Continental Petroleums, based in Jaipur, India, reported that its net profit rose 35% to Rs 1.1 crore. Total revenue increased 7% to Rs 31.7 crore, up from Rs 29.5 crore. Total expenses for the quarter were up 6% at Rs 30.1 crore.