Oil Refinery Companies in India: An Overview
New oil refinery ventures are springing up in India due to the increasing demand for diesel and petrol. Oil refining involves many steps to process crude oil into valuable fuels such as gasoline, kerosene, and diesel. The current number of oil refineries in India is insufficient to meet the growing demand for refined petroleum products. Thus, new players are entering this market to cater to this need. To know more about current oil refineries stocks in India, read on.
Oil & Gas Industry Overview
According to the IEA (India Energy Outlook 2021), India's primary energy demand will nearly double to 1,123 million tonnes of oil equivalent by 2040.
India is the continent's second-largest oil refiner as of September 2021, with a capacity of 248.9 MMTPA. At the time, around 35% of the nation's refining capacity was held by private enterprises.
It is anticipated that India will be a significant driver of worldwide expansion in non-OECD petroleum consumption. In April–July of 2022, India consumed 72.74 MMT of petroleum products. In FY22, 38.84% of India's petroleum product consumption came from High-Speed Diesel, making it the country's most famous oil product.
In June of 2022.2, the volume of LNG imported by India was 2,451 MMSCM. In the same month, total LNG output reached 2,813 MMSCM. The International Energy Agency (IEA) predicts that between 2017 and 2024, India's natural gas consumption will increase by 25 BCM or about 9% annually. So, investment in oil refinery companies has gained popularity among investors as the market has expanded.
Why Invest in Oil Refinery Stocks?
The Indian refining sector is expected to grow at a rate of 15% in the next five years. Currently, there is a shortage of refining capacity in the country, and there is a high demand-supply gap for refined petroleum products. This demand-supply gap will be bridged when the new refineries come online. Moreover, the Indian government has announced plans to encourage the refining sector in the country to bridge the gap between demand and supply. The government has also established certain incentives to promote oil refinery companies. The refining sector is expected to grow faster in the coming years because of the rising demand for refined petroleum products such as gasoline and diesel. Also, since India is the third largest exporter of crude oil, refineries in the country have access to low-cost crude oil.
Top 10 Oil Refineries in India
Oil refineries are tasked with processing a wide range of crude oils into finished goods. As the largest refining hub in the world, Reliance operates the largest refinery in the world. The top 10 oil refineries in India are ranked here.
- Jamnagar Refinery – Reliance Industries Limited
- Vadinar Refinery – Nayara Energy Limited
- Kochi Refinery – Bharat Petroleum Corporation Limited
- Mangalore Refinery – Oil and Natural Gas Corporation
- Paradip Refinery – Indian Oil Corporation Limited
- Panipat Refinery – Indian Oil Corporation Limited
- Gujarat Refinery – Indian Oil Corporation Limited
- Mumbai Refinery – Bharat Petroleum Corporation Limited
- Guru Gobind Singh Refinery – HPCL Mittal Energy Limited
- Manali Refinery – Chennai Petroleum Corporation Limited
Top Oil Refinery Companies in India
| Stock Name | Share Price (INR) | 52 Week High (INR) | 52 Week Low (INR) | Market Cap (Rs. cr) |
| Reliance Industries | 2408.75 | 2856.15 | 2180.00 | 16,04,731 |
| Indian Oil Corporation Limited | 66.05 | 94.33 | 65.20 | 93,624 |
| Bharat Petroleum Corporation Limited | 296.55 | 470.00 | 291.55 | 64,408 |
| Hindustan Petroleum Corporation Limited | 202.25 | 354.80 | 200.85 | 29,073 |
(Share Price as of 17th October 2022)
Disclaimer: The securities quoted are exemplary and not recommendatory. Past performance is not indicative of future returns
Reliance Industries
Reliance Industries' share is among the top shares in the Indian market regarding refineries stocks. It operates the world's biggest refinery, Jamnagar Refinery. With a daily output of 1,240,000 barrels, the private sector crude oil refinery can process a broad range of crude oils and create several petroleum products. Jamnagar refinery exports fuels worldwide. This refinery can process 580,000 BPD. Reliance Industries shares trade at ₹ 2,399.80 (on October 14th, 2022, at 1:39 PM IST).
Fundamentals
Market Cap: ₹16,07,809 Cr
- P/E Ratio(TTM): 24.04
- Debt to Equity: 0.36
- ROE: 8.21%
- Face Value: 10
Indian Oil Corporation Limited ( IOCL)
Indian Oil Corporation Limited (IOCL) is an Indian state-owned oil and gas corporation. It is one of the largest energy companies in India. The company was founded in 1956 in New Delhi. It is responsible for the exploration, extraction, refining, and transportation of crude oil, natural gas, and petroleum products. IOCL also engages in power generation. It operates in around 20 countries across five continents. It has the largest refining capacity in the country. IOCL operates 15 refineries that process about 171.9 million tons of crude oil annually. It has a network of over 14,000 retail outlets in India. IOCL's recent share price is ₹66.80 (on October 14th, 2022, at 1:41 PM IST)
Fundamentals
Market Cap: ₹94,965 Cr
- P/E Ratio(TTM): 4.99
- Debt to Equity: 0.99
- ROE: 20.46%
- Face Value: 10
Bharat Petroleum Corporation Limited (BPCL)
Bharat Petroleum Corporation Limited (BPCL) is an Indian state-owned oil and gas company based in New Delhi, India. BPCL is one of the largest downstream companies in India, with the second-largest refining capacity in the country. It operates five refineries in India with a combined refining capacity of 101.75 million tons annually. BPCL has a network of over 9,300 retail outlets in India, Nepal, and Sri Lanka. The share price is ₹ 300.45 right now (on October 14th, 2022, at 1:42 PM IST).
Fundamentals
Market Cap: ₹65,413 Cr
- P/E Ratio(TTM): 24.22
- Debt to Equity: 1.24
- ROE: 22.15%
- Face Value: 10
Hindustan Petroleum Corporation Limited (HPCL)
Hindustan Petroleum Corporation Limited (HPCL) is an Indian state-owned oil and gas company headquartered in Mumbai, Maharashtra, India. It is India's third largest oil refining company, after Indian Oil Corporation and Bharat Petroleum. It manufactures a wide range of petroleum products, including gasoline, diesel, aviation fuel, turbine fuel, kerosene, and furnace oil. HPCL operates four refineries in India with a combined refining capacity of 84.99 million tons per year. It has a network of over 5,200 retail outlets in India. HPCL currently trades at ₹ 206.90 (on October 14th, 2022, at 1:47 PM IST)
Fundamentals
Market Cap: ₹29,868 Cr
- P/E Ratio(TTM): 4.88
- Debt to Equity: 6.04
- ROE: 18.35%
- Face Value: 10
This is not an investment advisory. The blog is for information purposes only. Investments in the securities market are subject to market risks, read all the related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements, risk tolerance, goal, time frame, risk and reward balance, and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs. The performance and returns of any investment portfolio can neither be predicted nor guaranteed.
Conclusion
Goods stocks can be great sources of income, which is why many investors choose them. Oil refinery stocks offer income that is safe and stable. This makes them very attractive for long-term investments. You can consider investing in oil refinery stocks if you are looking for a reliable and profitable investment opportunity in the Indian economy. You must carefully select the refineries you want to invest in, as the demand for refined petroleum products is expected to rise in the coming years.
Why are refineries important?
Refineries turn crude oil into fuels for transportation, heating, building roads, producing electricity, and creating chemicals. Refining separates crude oil into its components, which are then reconfigured.
Who owns India's biggest refinery?
Since its opening in July 1999, the Jamnagar Refinery has processed 1.24 million barrels of crude oil daily, making it the world's biggest refinery. It is in Jamnagar, Gujarat, India, owned by Reliance Industries Limited.
Is it risky to invest money in oil refineries stocks?
There are many risks associated with investing in oil refineries stocks. The risks include commodity price volatility, dividend cuts at dividend-paying corporations, and the potential for an oil spill or other mishap during the refinery processes. Do proper research before any investment.