FLASHNEWS:

IGI Securities Limited – Day Break (04-10-2021)

Karachi, October 04, 2021 (PPI-OT): Monthly POL Sales – Sep 2021: Sales rebounded by +29%y/y to 1.96mn tons led by growth in retail segment

Industry volumes for oil marketing companies for the month of Sep-21 witnessed a growth of +29%YoY to 1.96mn ton bringing industry volumes for 3MFY22 to 5.86mn ton up by +24%YoY. High Speed Diesel (HSD) / Furnace Oil (FO) / Motor Spirit (MS) sales were up by +51%/+28%/+25%YoY during Sep-21. On a monthly basis, industry volumes remained flat during Sep-21 on the back of +9%/+6%MoM incline in MS/HSD sales while FO sales declined by 21%MoM.

During the 3MFY22, FO/HSD/MS sales increased by +29%/+27%/+14%YoY. Company wise PSO/SHEL/APL led the charts by posting +34%/+26%/+23%YoY incline in total sales while HASCOL witnessed 60%YoY plunge in total volumes with market share for HASCOL dropping by 3% to 2%. However PSO’s market share increased by +4% to 52%. SHEL and APL retained their market share at 7% and 10% respectively.

MS: MS sales inclined by +25%YoY to 0.80mn ton in Sep-21, while on sequential basis, volumes are up by +9%MoM. PSO, APL and SHEL posted +39%YoY, +31%YoY and +17%YoY growth in volumes respectively, while HASCOL reported 53%YoY decline during Sep-21. For 3MFY22, MS volumes are up by +14%YoY to 2.35mn ton. During 3MCY22, APL, PSO and SHEL posted +27%YoY, +21%YoY and +14%YoY growth in volumes respectively with PSO and APLs market share rising to 46% and 8% respectively, while HASCOL registered 74%YoY decline in sales with market share dropping to 2%.

HSD: HSD sales increased by +51%YoY to 0.71mn ton in Sep-21, while on monthly basis volumes are up by +6%MoM. This brings total 3MFY22 sales at 2.10mn ton up by +27%YoY. For 3MFY22, APL, SHEL and PSO led the charts with +41%YoY, +40%YoY and +26%YoY growth in sales with market share for SHEL and APL increasing to 8% each respectively, while PSO’s market share decline by 1% to 48%. HASCOL registered 73%YoY decline in volumes during 3MFY22 with market share coming down to 1% from 5% in 3MFY22.

FO: FO volumes increased by +7%YoY during Sep-21 to 0.40mn ton likely attributable to higher demand from IPPs compared to last year. Volumes are down by 21%MoM in Sep-21. As a result, total FO volumes are up by +38%YoY in 3MFY22 to 1.27mn ton. For 3MFY22, HASCOL, PSO and APL reported +7xYoY, +66%YoY and +13%YoY incline in sales with PSO’s market share increasing to 65% compared to 54% in 3MFY21.

Outlook: MS sales are likely to remain strong during 2HCY21 as automobile sales pick up along with introduction of new vehicles by new entrants such as KIA and Hyundai. HSD sales are likely to remain elevated amid pick up in commercial activity however rise in grey market sales and extended lockdowns may likely hurt volumetric growth. FO sales are likely to remain strong in coming months.