Good morning, and greetings. On behalf of IIFL Securities, I welcome you all for the third quarter earnings call of BPCL. To help us understand the quarter gone by and share performance outlook for the subsequent quarters, we have the senior management team of BPCL represented by Mr. N. Vijayagopal, Director Finance, Mrs. Teresa Naidu, ED Corporate Treasury, Mr. V. R. K. Gupta, GM Corporate Finance, Ms. Jenny, CGM Pricing and Insurance, Girwar Bhattad, Senior Manager, Pricing and Insurance, and Piyush Borania, Senior Manager, Pricing and Insurance. I first hand over the line to Piyush, who will make the opening remarks and hand the call to Director Finance, who will share his perspective. After which the session will be open for Q&A. Over to you, Piyush. Thanks, Harsh. On behalf of the BPCL team, I welcome you one and all to this post Q3 result con call. Before we begin, I would like to mention that some of the statements that we would make during this con call may be forward-looking in nature, and we believe that the expectations contained in such statements are reasonable. Their nature involves number of risks and uncertainties that may lead to different results. These forward-looking statements represent only the current expectations and belief, and we do not provide any assurance that such expectation will prove correct. Since this is a quarterly result review, please restrict your questions to Q3 results only. I now request our Director Finance, Mr. N. Vijayagopal, who is leading the BPCL team for this call, to make his opening remarks. Thank you. Over to you, sir. Yes. Thank you. Good morning, everyone. Welcome once again to the Q3 post results con call. You would have got a handout giving the quarter results. I would like to touch upon a few points on the quarter gone by. The easing of COVID restrictions, rollout of vaccination, and festival season has helped us to boost demand towards the end of the last calendar year. The agricultural sector is now on a growth trajectory after a good monsoon. Credit growth has turned positive in year terms for the first time in this fiscal year. Power demand is up by 14%. All major states had improved GST collection in December as compared to last year. BPCL has recorded 24% growth in domestic sales volume from 8.94 million metric tons in Q2 to 11.10 million metric tons in Q3 of the current financial year. MS has grown up by 15%, HSD by over 31%, and LPG by 9% in Q3 over the Q2 of the financial year. Apart from the urban centers and major towns where we are traditionally strong, we have started registering better growth from rural and small town areas due to the aggressive retail outlet expansion during the year. We registered a growth in market share in MS and HSD of 0.62% and 1.05% in Q3 as against 0.12 and 0.53% in Q2 of the current fiscal year. In highway market during Q3, we secured highest growth among PSUs in view of the faster recovery of volumes due to transport movements and acquiring high volume customers through continuous engagement. I'm happy to tell you that we recorded the best performance for HSD and MS in market sales among PSUs in Q3 of 2021. Particularly in MS, we grew by 6.76% and HSD by 2% for Q3 as compared to the Q3 of the previous year. Public transport is not back to normal levels yet. Schools and education institutions continue to remain shut in most parts of the country. Due to the steep decline in tourism, entertainment, et cetera, slow recovery in services sector still remains a concern in case of demand for transportation fuels. As scheduled international flights are yet to commence and with various restrictions still in place around the world, our ATF sales is at around 54% less as compared to Q3 sales of the previous year. There's a 34% increase in the Q3 as compared to Q2 of the current fiscal year. With multiple virus strains still posing a threat and lockdowns continuing in various parts of the globe, the product tax remains subdued. MS has declined from an average of over $8.19 to a barrel in Q3 of the previous year to just about $2.97 to a barrel in Q3 of the current financial year. HSD tax declined from $15.41 to just over $4.34 to a barrel. When we compare Q3 to Q3 of the previous fiscal year, the Indian basket of crude has declined from $63 - $45. The rupee has depreciated from INR 71.23 to INR 73.74. BPCL GRM stood at $2.47 to a barrel in Q3 of the current fiscal year as compared to the $3.23 to a barrel in Q3 of the previous year. However, BPCL has the highest GRM amongst the oil PSUs. Product tax has slightly improved further in the month of January 2021 over the Q3 numbers. Our refinery throughput, which was around 76% during the quarter two, has increased to 105% of the nameplate capacity in the Q3 of this year. The crude oil throughput for the third quarter is 7.24 million metric tons as compared to over 5.63 million metric tons during the Q2. Refinery throughput, which was moderated earlier due to low demand, has considerably improved. Our distillate yield has improved to 86%, as compared to the third quarter of the previous year at 84%. Our EBITDA has improved by over 68%, from INR 3,221 crores to INR 5,401 crores for the third quarter when compared to the year-over-year. Profit after tax has more than doubled from INR 1,261 crores for the quarter three of the previous fiscal year to INR 2,778 crores for the third quarter of the current year. Profit after tax for the nine months has increased from INR 4,044 crores to INR 7,102 crores year-over-year. This is after taking into account expenditure on ESPS scheme amounting to INR 544 crores and cost of the VRS scheme amounting to INR 706 crores. With the easing of lockdowns, we have revised our CapEx targets to INR 9,000 crores from the earlier target of INR 8,000 crores. We already spent INR 5,688 crore during the nine-month period ending December 31st, 2020. With just over INR 900 crore being spent in the first quarter, we are very confident of surpassing the target of INR 9,000 crore as we close the year. During the quarter passed by, we have added 730 retail outlets. During the current fiscal year, we have already added 1,692 new retail outlets. Last year, we had 1,447 new outlets. We hope to have 2,000 more outlets in this financial year overall. A new jetty, JD5, has been commissioned in January 2021 for receipt of crude oil by Mumbai Refinery. This will enable MR to receive fully loaded Suezmax vessels, leading to considerable savings in crude freight costs. Our borrowings as on December 31st, 2020 was at INR 24,674 crore. It has further eased from INR 27,849 crore at close of Q2, and a peak level of about INR 41,800 crore at the end of March 2020. These are excluding the lease obligations amounting to about INR 6,228 crore at the end of the third quarter of current financial year. The debt-equity ratio as at the end of Q3 is 0.60 as compared to 0.63 when compared on year-over-year. The debt equity ratio has thus come down substantially from the level of 1.26 at the end of the financial year 2020. As on March 31st, 2020, we had around INR 6,200 crore outstanding receivables from the Government of India for account of subsidies, which has been steadily coming down. As on date, the dues amount to about INR 2,200 crore. There is no under-recovery on LDO and minimal subsidy on LPG. I now invite questions and for clarifications. Thank you. Thank you very much. We'll now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Vijay Sarda from Crescita Investment. Please go ahead. Good morning, sir. Just two questions. One is on how is the progress on divestment happening? We have got this interim dividend of INR 16 now, and we were expected the news on Numaligarh Refinery, or particularly sale off to some company. What is the progress there? Last, what is going to be status on the investment which is lying on our books? Will that be separated or carved out as a one vehicle and the share will be distributed in the proportion? This is the one question. Second, just wanted to understand, sir. We have declared interim dividend of INR 16. Have we declared date for the same, interim dividend date? Secondly, sir, if the date is before like this expiry, I think many of our investors in the PMS, they do invest through these futures also. If the due date is within this month, they will get affected by this kind of dividend outflow or dividend investment. If it can be kept after this expiry, that will be quite helpful for the investor who invests through these future routes. You are asking too many questions in one question. To answer your last question, the record date for interim dividend is February 19th. I don't want to answer other connected questions because I don't understand that side. As far as the Numaligarh divestment is concerned, BPCL has a 61.65% stake in NRL, which will be divested to a consortium led by Oil India, in which Engineers India is also a member. Out of the 61.65%, 13.65% of the stake will be given to the Government of Assam, who has a right of first refusal, and they have actually taken that right and told that they are prepared to take at the price at which the deal is closed with Oil India. We are on the job, and we are very serious about it. The sale purchase agreement for this deal has been approved by the BPCL board yesterday. We have shared that with Oil India, we are also doing the valuation exercise through our transaction advisor, which is Deloitte, and the legal advisor and asset valuer. We are very confident that, barring unforeseen circumstances, if the government approvals are coming in time, we should be able to close this deal as we close the financial year. For the BPCL divestment, data room is ready from our side, the digital data room is ready. We are waiting for the transaction advisor and DIPAM to advise us to whom this facility should be made available. Thank you. The next question is from the line of Avadhoot Sabnis from InCred Capital. Please go ahead. Sir, my first question relates to your E&P operations, and I'm afraid you're going to accuse me of quite a bit of tough questions there as well. In the last six months, you have impaired around nine E&P blocks. Firstly, I want to know, whatever is impaired, I presume all those blocks will be relinquished. Secondly, the extent of impairment, which is around INR 15.8 billion, is broadly around half of the net worth as on March of BPRL. Would it imply any additional equity infusion into BPRL at this point of time? A related question on that is, if you could share, what was the consolidated debt number, including lease, as on end of December. In terms of the actual accounting of that INR 15.8 billion, which heads is it going to? There's some part which we have said is exceptional. If you could share out of the INR 15.8 billion, how does it accounted, which line item in the accounts? Lastly, in terms of clean up, I just specifically wanted to ask this on Wahoo, which was discovered eight years back. Is it still standing in the books at book value? Okay. Can I answer E&P questions first, and then we'll take that extra exceptional items. On the E&P side, if you see the world oil majors have all impaired substantial amounts. We take Chevron, Exxon, Shell, anyone. I've done that, and we have followed the best practices in our exploration subsidiary of BPRL. The major impairment has happened in investment we have an asset in Brazil, ACAL, where based on the prospects and the recoverable reserves, and they have taken a certain crude oil price assumptions, which required an impairment portion to be created. Nothing to worry about that, it is in BPRL books. It has not spread to BPCL because overall BPCL investment continues to remain intact at this stage. This impairment will be probably reversed if the position improves later. We have taken a very conservative approach to creating the impairment, following the best global practices. The other nine small blocks where we have impaired Indian blocks mainly are all very insignificant for BPRL. I do not know the exact details of write-off where the impairment has been made, because these are nine small blocks. We can share the data with you subsequently. I can't even remember. Okay. Impairment where we are showing up. Yeah. On the effect of this impairment, some portion we have presented in exceptional item around INR 266 crore, because that is the impairment routed through subsidiary. Some other cases of impairment, it is routed through equity accounted investees. There is separate line, equity accounted investees, there is a negative values there. That is where actually the presentation of entire INR 1,500 crore has gone into financial values. In the consolidated. In the consolidated. Last part of your question, our total debt, as at December, is INR 24,674 crore. This is excluding the lease liability, which is amounting to INR 6,228 crore. Thank you so much. Has there been any additional equity infusion in BPRL in the first nine months? In this year, we have infused INR 650 crore equity into BPRL, and we are committed to invest in BPRL further because as per the CCEA approval for the Mozambique development, we have taken the permission from CCEA, the Government of India, to increase the equity capital of BPRL from INR 5,000 crore to INR 15,000 crore. We are committed to stand by BPRL during the period when they develop the Mozambique gas, which is a massive project. Yeah, this INR 650 is not related to Mozambique expansion, right? Sorry. Yes. It is, because that is where they need money. They have a project where they need to spend about $2 billion. They have a 70/30 equity-debt ratio. The equity has to come from BPCL. It is linked to Mozambique, essentially. As the Brazil development happens, we may need to go to CCEA again, and there'll be further equity infusion is required. Great. Sorry, if I may squeeze two more separate questions. One is, given the extent of VRS that has taken place, could you give us some sense of what is the normal sort of staff cost that will be in standalone accounts in FY 2022? Second question is, any update on the headcount in Kochi Refinery? I think you have said in the last call that it will be done by March 2021. Is that date still up? Thank you. Yeah. Actually, our strategy has been to reduce the manpower numbers. It is not only the VRS announcement of the year 2020 which has evoked a very good response. As an organization, we believe in optimizing the number of manpower. We have reduced steadily over the years. If you take the last 10 years, in spite of massive expansion of BPCL, the manpower numbers has come down considerably over the last 10 years. It is our policy to continue to do that. We are not recruiting people only for the purpose of providing employment. That is the first part. If you say the employee expenditure for the year, it is about INR 869 crores for the quarter. Overall, last year, the total was about INR 3,000- Nine months. Yeah. Nine months, it is INR 3,344 crore, and the whole year is INR 3,691 crore. Manpower constitutes a significant part of our total operating expenditure, and therefore, we are committed to continue to rationalize the manpower going forward. That is the first part of your question, and second was? Number of employees. Number of employees is today around 9,600. I don't have the number of HPCL. Yeah. There was another question? No. Okay. Thank you. The next question is from the line of Nafeesa Gupta from BofA Securities. Please go ahead. Thank you. Good morning, sir. My first question is regarding the other income in the third quarter. Is it possible to give the split of the other income because it was substantially higher? The other income has gone up substantially because of dividends from NRL, which amounts to around INR 612 crores. All right. The second question is regarding the deal with BORL. Any update on that and the timelines there at all? Yeah. As far as BORL, the Omani stake, we have been negotiating. We have reached a certain understanding with them already. We are reached a stage where we can confidently say that a disclosure and regulatory filing is expected anytime soon, maybe in the next 10 days from today. Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants, requested to please limit your questions to two per participant. If you have a follow-up question, you may rejoin the queue. The next question is from the line of Anubhav Agarwal from Credit Suisse. Please go ahead. Yes, good morning. My question is on other expenses. This quarter run rate of INR 3,900 crore, would you say this had some COVID-related benefit in terms of lesser extra travel, et cetera? No, this is the new base for us. Can you just explain, is this a new base or this had some savings? No. Actually, that is not COVID-related. The other expenditure mainly was higher because of two specific reasons. We had a VRS debit. VRS was announced, and actually, the entire amount was debited, which is about INR 700 plus crore. About INR 540 crore on account of the ESPS, which is the discount which we give to the employees. The total amount of discount will be around INR 1,000 crore, and as per the accounting conventions, we have done it in phases. First quarter and second quarter together, second and third quarter together have taken about INR 544 crore. These are not going to continue. These are one-off events. No, sir. Actually, I was asking, adjusted for all this, our other expenses were INR 3,900 crore in this quarter, which is lower than what our usual run rate has been. I'm asking this adjusted number of INR 3,900 crore, did this have some amount of savings because of lesser travel during the COVID period, or is this a new base for us? No, actually, you see this particular quarter, the throughput is also lower at refinery side. There is a small saving in respect of operating expenditure. The savings may not be repeated in the subsequent years because this year, on account of travel and various low initiatives, the expenditure is low. The one-time expenditure this quarter is only ESPS around INR 440 crores. Otherwise, this may not be the new normal. A little bit lower expenditure this year. It may not repeat in the subsequent years. My second question was on the personal cost. INR 800 crore this quarter, what is extent, right? For example, you mentioned about reducing manpower and future also. What is the scope available in the sense that the same work can be done by like the 5% lesser workforce, 10% lesser workforce? Can you give some indication there? We are today the leanest organization in the oil space in the country. There is always scope for improvement, as also you must understand that we are expanding very rapidly. We have actually added about 1,500 outlets last year. 2,000 outlets will go up next this year. Our petchem is getting expanded. We, on an average, spend about INR 10,000 gross CapEx. Therefore, it is difficult to put a number as to how much numbers will come down on absolute terms. If you see our track record of the last 10 years, manpower reduction is an indication that we are very serious about manpower cost. I will not be able to tell you how many more numbers will go away in this fashion. Ideally, we are trying to reduce the manpower by not recruiting and replacing people who are retiring on a normal basis. It is impossible for us to reduce manpower just for the sake of it. Our idea is to optimize manpower to ensure that whoever is available is the best available in the country. Thank you. The next question is from the line of Pinakin from JP Morgan. Please go ahead. Thank you very much, sir. My question is on the Mozambique LNG project. We saw LNG prices surge, and even though now while they are coming off, they still are at elevated levels. Sir, two questions related to Mozambique LNG. One is, sir, can you give us a sense of when is the first gas expected at this point of time? We have seen external consultants talk about 2026. Second is, sir, can you give us an update as to how BPCL has tied up to its share of the Mozambique LNG? Has it kept it open to consume it internally, or has it entered into contracts to sell it down? The Mozambique LNG project is expected to provide the first gas to the consumers in the second half of calendar year 2024. That is the announcement from the operator's side. Total is a very renowned operator. They are known to actually deliver on their promises. We have no reason to doubt their conviction and the confidence that the first gas will come out in the second half of that year 2024. Regarding our commitment, it's 1 million tons of gas per year coming from Mozambique, starting from the year 2026. We have already a 2 million base of customers. We have certain commitments to the Qatargas and also the RasGas. Apart from our commitment to go for spot gases to fill the demand, we are very confident of absorbing this gas and our ambition in the gas in the next five years is to go up from 2 million tons - 5 million tons. We find a huge opportunity for expanding the gas base in the country, and we are committed to ensure that we will capture the gas market as it increases in this country from 6% of the energy basket to 15%, as per the government's desire. Thank you. The next question is from the line of Sabri Hazarika from Emkay Global. Please go ahead. Yeah, good morning, sir. I have two questions. The first one is relating to your CapEx guidance for FY 2022, there have been some media reports that certain projects like polyolefins has been deferred or maybe canceled. Any comment on that and the CapEx guidance? For the year 2021, we have actually enhanced our number from 8,000 - 9,000 tons. We have actually delivered 5,600 tons in spite of a suppressing number of only 900 tons in the first quarter. We are going to exceed 9,000 tons as we close year 2021. For 2021/2022, we have a target of 10,000 tons CapEx roughly, and we are not coming out of any of the commitments. We are actually conscious of the need to take a relook at some of our expansion and plans like, for example, EMMA and residue upgradation projects. Which we are now taking a look at it, especially because of the disinvestment in the horizon. All the approved projects by BPCL, we are seriously pursuing as it is. Okay, sir. Second question is on the BORL and NRL Q3 GRM and profits. BORL GRM is around $2, and NRL GRM is $37. Profits? Profit, NRL is around INR 830 crore, and BORL, it's a loss of INR 210 crore. For Q3? For Q3. Right. Thank you so much. Thank you. The next question is from the line of S. Ramesh from Nirmal Bang. Please go ahead. Thank you, and good morning. The first thought is, now in your margins, we have seen that you are able to increase your marketing margins, whether you take it in absolute numbers or per ton margins. Overall, if you see the total EBITDA coming to about $4 a barrel or INR 2,000 a ton. In terms of your own commenting in the past that you are looking at it on an integrated basis, is there any scope in future to improve on this margin per unit or per ton? Would you depend on volume growth for your earnings growth in fourth quarter specifically and going forward in FY 2022? That's the first question. Yeah. Our marketing margins has to be seen on a long-term basis. If you see the marketing margins of the last three quarters, our margins were higher in the first quarter, but it has moderated slightly to second quarter, and the marketing margin between second and third quarter remains almost at the same levels. We are confident to sustain these levels of margins going forward. Okay. In terms of the upstream business, now you have mentioned that you have provided for the impairment in Bharat PetroResources. What is the current net worth in Bharat PetroResources in your consolidated balance sheet, and how do you see this moving, say, in the next couple of years? We can take that question offline. We will answer that and get back. Okay. We'll get back on that. Yeah. Just one last thought. Now, in terms of your petrochemical project is under implementation for your Oxo alcohols project. What is the latest timeline in terms of when you'll be able to get it commissioned and started? Two of the units of PDPP is slated to be commissioned in March, and one unit will take some more time. It is essentially because of the licensors' experts to come down to India to actually be part of this commissioning exercise. We have been trying to do our level best to see how far it is possible to do a remote inspection and clearance by the licensors representatives. We are taking all the efforts possible to see how far we can take these units on stream. As of now, we are fairly confident of commissioning two of the three units by March of this year and the third unit by May. Thank you very much, Vijay. I'll join the queue. Thank you. Thank you. Thank you. The next question is from the line of Reena Shah from Ashika Stock Broking. Please go ahead. Hello? Can you hear me? Yes, please. Thank you, sir. Thank you, sir. Thank you for the opportunity. Sir, my first question is on the jetty that you have commissioned in Mumbai refinery. They're saying that you are expected to save a lot of crude freight cost. I just wanted to understand where you are servicing your refinery's OpEx going forward, and how much this particular unit will add to the benefit. Crude freight costs are not counted as part of the operating expenditure. Okay. It forms part of the crude cost. It is one of the elements of the landed cost of the crude oil. The benefit which we're getting is that we will be able to use a fully loaded Suezmax for the purpose of transportation of crude oil into Mumbai, which is expected to have a huge benefit for MR's operations. Sir, can you just specify how much can it be like? Ultimately, I believe freight cost would be not related to the crude cost and it would be somewhere fixed. Just wanted to understand- No. how much it can improve your GRM. Freight cost is definitely not straightforward. The correlation is not there with the crude cost. Freight has its own logics of moving up and coming down, Baltic index based. Freight is, again, a matter of changing very drastically because it is also not a static thing. We expect a substantial reduction. It can be about INR 1 to a barrel. Okay. For crude oil landed cost coming down in terms of transportation roughly at the current level. It can change. Okay. Thank you, sir. That helps. Another question is, how much crude and product inventory and at what cost do you have at the end of this third quarter? Can you repeat that? Crude and product inventory. Crude and product inventory and crude cost at the end of this particular quarter. Crude, we had 1.89 million metric tons of crude, and product, we had around 3 million metric tons as at the end of December 2020. Okay. Crude cost? Crude cost average rate was $53 per bbl. Okay. That helps. Thank you, sir. Thank you. The next question is from the line of Vidyadhar Ginde from ICICI Securities. Please go ahead. Yeah, thank you. Some of my questions have been answered. One is on if you could share your petroleum diesel volume growth in January. January? Yeah, January 2021. How is it YoY, petroleum diesel? The growth for MS is for January 2021 versus January 2020 is 6.83% while for diesel it is a negative of 1.05%. Also, I'd like to state that in petrol we are the highest among all the OMCs. This is for January, isn't it? Yes. The second question was on what is your subsidy due from government as of December? INR 2,200 crores. Is the current outstanding? What was it in March? INR 6,600 crores. Okay. One last thing. I just want to confirm, in response to one of the earlier questions, you appear to have stated that though the marketing margins may not be very relatively low in the current quarter, you expect it to be next year and a full period like FY 2022. I think in one of the earlier calls you had stated two to two and a half rupees. Is that what you said, that next year you expect marketing margins to be in line with that? We have not stated any specific numbers of marketing margins. What we said was that marketing margin has to be seen on a long-term basis. What we stated was that second quarter and third quarter of this financial year represents normalized marketing margins. We also stated that this trend is expected to continue on a long-term basis. Okay. Yes. Thank you. Thank you. The next question is from the line of Varatharajan from Systematix. Please go ahead. Thank you. Can you give us some breakups on the CapEx, which division and what end use for current year and next year, and maybe if possible for the following year as well? We have a plan of spending around INR 9,000 crores in the current year. Out of that, around INR 2,000 crores we'll be spending in refinery, around INR 800 crores in petchem. Marketing, which includes RO expansions and depot expansions and renovations, is around INR 3,600 crores. The other portion goes to our gas DPR and equity investments and pipelines. For the next year, the plan is of INR 10,000 crores, and this is a broad breakup which we are giving. Refineries, we'll be spending around INR 2,600 crores. Petchem, again, around INR 970 crores, and marketing would be around INR 3,200 crores. Thanks. Thank you. The next question is from the line of Amit from UBS Securities. Please go ahead. Yeah. Thanks for taking my question. Sir, why there has been so much delay in deciding the interested parties and opening up the books for due diligence? 17 November, I remember, was the last date for expression of interest. What has held up this kind of delay? We really do not know. Okay. Sir, what will be the process from here going forward? You mentioned that in the current financial year, we were looking to complete this deal. Now I think it seems very clear that it will be pushed to next financial year. How much sure we are that with this kind of delays on the government part or the transaction advisory part, that the deal would be completed in the next financial year? What are the steps involved from here? No, this disinvestment of NRL, we are trying to aggressively pursue and complete, if possible, by the end of this financial year. That is before March 31st, 2021. With BPCL disinvestment, the DIPAM processes are to be fully complied with. It is driven by the Finance Ministry and Department of Investment and Public Asset Management. BPCL only facilitating the completion of the formalities and opening the data room and providing clarification to investors, doubts and clarifications. Beyond that, our role is very limited. It is not possible for us to answer your questions about when it is going to be completed. I also have read, like you, the budget speech in which honorable Finance Minister has mentioned that this will be completed in the year 2021-2022. Okay. Sir, just last question. This would require CCI and other approvals for the deal to be completed and money to be paid to the shareholders? Which, NRL or BPCL? Sir, BPCL. BPCL deal will not require a CCI approval. It is two government companies are transacting this business. As far as I understand it, does not require a Competition Commission approval. It will require approvals at the government levels, and as far as we understand, the government level, at the top level, is what is called an alternate mechanism, which consists of the honorable Finance Minister or Petroleum Minister and Road and Transport Minister. Okay. Thank you, sir. Thanks for your help. Thank you. The next question is from the line of Mayank Maheshwari from Morgan Stanley. Please go ahead. Thanks for the call, sir. Two questions from my end. The first was regarding the PDPP project. You talked about two units starting up by March. Can you just talk to us about the entire process of ramping up this project and how you're thinking up in terms of positive EBITDA contribution from this coming sooner? No ramping up is envisaged. This is actually a capacity which is already designed, and we are confident of using this capacity to its full potential. Our industrial and commercial section of BPCL has already test marketed these products. These are import substitutes, and the prices fluctuate because, like in the case of petroleum products, and therefore, it will be difficult for me to put a value into the EBITDA. We don't expect a huge benefit which is going to come in the year 2021 or even 2021-2022 in terms of profit before tax. It's a long-term Yeah. Okay, sir, the exports that you were doing of propylene, will that come down and that should help at least reduce the losses? Propylene, we are not exporting, and we have a production capacity of 500 TMT of propylene in Kochi, which is petrograde, and half of it will be consumed in the PDPP, other half will continue to be sold as propylene in the western part of the country. We have a project for the polyolefins, which was mentioned in one of the questions, which is going to take the other 250 TMT of propylene which comes out of our FCCU in Kochi. Got it. Sir, the second question was more related to the refining itself. I think your jet fuel sales are still obviously lower compared to the normal levels when refinery utilization rates have ramped up. Can you just talk to us about your product slate now in terms of how much has that still getting converted to diesel or gasoline? No, aviation fuel, basically because we are predominantly catering to the global markets in the sense that international flights is our major customer base because of the Shell legacy. About 60% of our customers are international flights, and as we know, international flights are not opened up yet. Domestic has almost reached about 80% of the pre-COVID level. International flights are very few and a lot of restrictions are there. That is the reason why our aviation turbine fuel sales have not picked up as much as it was in the case of MS or HSD. We have a flexibility to use aviation fuel or convert that into diesel. Just recently, our subsidiary by BORL has also completed a CACS. We are not very worried about aviation fuel sales not happening because it is not going to affect our throughput at all. Our MS HSD production will not be impacted by the reduction in the sales volume of aviation fuel. Got it. Very clear. Thank you, sir. Thank you. The next question is from the line of Vipul Shah from Sumangal Investments. Please go ahead. Mr. Vipul Shah, may we request you to please go ahead with your question. Mr. Shah, may we request you to unmute yourself if muted from your handset. As there is no response, we will move to the next question, which is from the line of Sumit Rohra from Matan Private Limited. Please go ahead. Hi, sir. Good morning. My company name is Helios Capital Limited. Sir, just couple of points. As an investor, I wanted to ask you. Sir, you mentioned that in Numaligarh, we hope to complete it by March. Sir, can you give a broad sense of valuation? I mean, the kind of reports which the media talks about is about INR 7,000 crore. Is that something which is correct? Secondly, sir, you mentioned that you added about 1,500 outlets. What's our total outlets currently? The other point that I wanted to check with you is on the government bonds. Do we have any government bonds, and are those bonds going to be repaid before the strategic stake sale and investors can expect a big dividend payout? Sir, the point I'm trying to highlight here is that, as an investor, the more clarity there is, the higher the valuation of BPCL, the government will realize. One thing which I'm noticing is that after November 17th, when the expression of interest date has closed, there's been no official communication. That kind of is keeping a very big cap on the share price of BPCL. I mean, just to highlight this to you, sir, the share price of BPCL was INR 480 when the Nifty was 10,000. Today, we are at 15,000, and the share price of BPCL, in spite of strategic sale, is at INR 425. It's completely absurd, right? We know that the intrinsic value for Bharat Petroleum is well upward of the four-figure mark. Sir, if there is clarity on the various verticals, there can be huge value unlocking for all stakeholders. Frankly, the biggest beneficiant of this will be the Government of India. Sir, it's my humble request, if the more clarity we can give, the higher value the company will command, which in turn will result in the Government of India maximizing its potential of revenue. That's my request to you, sir. Thank you so much. I agree with you. Thanks for the comments. The easiest question to answer is number of retail outlets at the period end. As of December, we had 17,841 rated outlets. To your other questions, some of them were statements. We also feel, as management of BPCL, that the current share prices of BPCL do not reflect its true potential. It is based on various factors because if you see, it is not BPCL alone. All the oil companies and, why oil companies, all the PSUs itself has not gone up the way other companies have gone up. I do not know the share market, but we are very confident that the potential of BPCL is not fully reflected in the current share prices. That much I know. Your lack of priority on the disinvestment process is a question that can be answered only by the government officials because we don't handle the sale of BPCL. It is handled by the Government of India, by the Department of Investment and Public Asset Management. For the NRL, I already mentioned that it is our intention to complete this deal if possible, subject to government approvals coming in time by the 31st of March of this year. Sure, sir. On the valuation of Numaligarh- Yeah. can we assume that? We have engaged a transaction advisor and an asset valuer for the purpose of valuation of NRL. It's a going concern, an operating company and having a steady profit growth and also they get a substantial amount of incentive in the form of access to the concessions. Valuation will be done using the known methods of valuation like DCF, asset valuation, multiple, and such things. It is too premature for me to comment on the valuation of NRL at this stage. It will be made known once the deal is completed. Wait for about another one and a half months, please. Okay. Sure, sir. Just one follow-up on the strategic sale. Mr. Tuhin Kanta Pandey has basically categorically said on Sunday that he expects the process to be completed, I use the word "completed," by Q1 FY 2022. Essentially, that means June 30. Sir, for that to happen, the data room window would have to be given for how much period? Would it be 60 days? Would it be 45 days? Would it be 90 days? Just as a process to understand, because this is what he's categorically stated. My only point is that, the more clarity we get, the better it is for all stakeholders. That's the only point I'm driving at. Sir, just 1 feedback which I have shared with the company secretary as well. This process of giving dividend, in the period when the settlement is on, because so many hedge funds, so many investors come through the route of the future segment. After highlighting this also to the company secretary last week, if this is ignored, then sir, it's not a very good thing from an investor angle, right? That we share honest feedback to the company and it's completely ignored and not looked at. It's not very professional for them to not look at our feedback. It's my humble request to you to please have a look at it and in future, such things will only increase the investor Can I just request you to restrict the questions because you are obviously robbing the time of others. Sure, sir. I'm sorry to say this. The second thing is that as far as Mr. Pandey's statements are concerned, I am not privy to that. I am not in a position to either contradict his statements or his confidence. We are ready with the data room today. It is for DIPAM to tell us when to open and how many days it should be kept open. There is a virtual data room available. How much time it takes to see all that we have is a matter of opinion of the potential bidders and a decision to be taken with DIPAM. We are ready from today. We are ready from the last two weeks, as a matter of fact. Therefore, we are also eager, and we are also equally supportive of your suggestion that more clarity on this disinvestment can possibly increase the share price of BPCL. Now about the dividend declaration. Dividend declaration is a board call. We don't play the market. It is not our intention to help or harm the interest of people who invest in BPCL shares about the timing of it. We have a consistent declaration of dividend policy. We are a very high dividend-paying company. If you have seen the DIPAM guidelines, now the DIPAM is expecting us to declare a dividend on completion of every quarter. It is not a private information. It is available in the public domain, and it is our intention, and it has been our consistent practice to declare high dividends. We have closed the accounts of this quarter ended 31st December with the highest profits in the quarter in the financial year, and we found it fit to be rewarding our investors who have been patiently waiting for this BPCL to perform consistently. We are interested in long-term investors of BPCL. We are actually committed to them, and we will continue to do that. Thank you. The next question is from the line of Pinakin from JP Morgan. Please go ahead. Yes, I'm sorry. What were the BORL GRM for the quarter, sir? BORL GRM for the quarter is $2.14. NRL was INR 37, right? Correct. Thank you, ma'am. Thank you. The next question is from the line of Saket Kapoor from Kapoor & Company. Please go ahead. Thank you, sir, for the opportunity. Sir, firstly, about this Numaligarh Refinery disinvestment. Sir, is it going to be a disinvestment type or sir, we will see the interest from other PSUs also, if categorically Engineers India have also highlighted, if I'm not wrong, about participating in the same. Is it going to be a purely professionally bidding system or it's an arrangement that is going to 55 going forward? Okay. Can I answer this? Yes. NRL disinvestment is actually based on the cabinet decision that before the BPCL stake is sold to a strategic investor, NRL should be divested. The Government also has decided that the stake has to be offered to a government company in the oil sector. The interest has come from Oil India. It is a consortium in which Oil India and Engineers India are partners. Engineers India and Oil India will jointly actually acquire the shares, excepting about 13.65%, which will go to Government of Assam because they have a right of first refusal, and they have evinced interest in acquiring this 13.65% to make a share to 26%. Now, it will be a professional valuation, I can assure you of that, and the valuation exercise is now undergoing. It is done by a very reputed transaction advisors and asset valuers, and it will be an announcement basis. There is no arrangement for this. This is a commercial transaction. Okay. What is the kind of valuation, sir, we can look? Have you discussed it in the con call? I missed the part there. We will not be in a position to disclose our valuation because valuation is a matter of opinion from the seller's and buyer's perspective. It requires some more time to get this disclosed. Too premature to tell the valuation at this stage. Thank you. The next question is from the line of S. Ramesh from Nirmal Bang. Please go ahead. Yeah, I just had a follow-up question on your refining performance. Your slate has improved, you see YoY, but your margins are lower and your high sulfur crude has come down. Can you explain why your margins? Is it only because of the spreads going down or what exactly is happening on the refining side? In this world today, there is not much difference between low sulfur, high sulfur. It makes no sense to buy high sulfur because processing high sulfur requires more energy. Right? Therefore, it is better to reduce our dependence on very high sulfur, because it does not make sense, because unless a Brent-Dubai differential reaches to $2.5 or around that, we have the facility to use the heaviest of crude oils in Kochi Refinery, but the timing of the pricing is not supporting that. Distillate yield is not going to make much of a difference in a scenario where our diesel cracks are less than $5 and MS cracks are around $3. The best of the product yields these cracks. This is not a normal time. We are expecting and believing that the cracks will improve to a normal level as soon as it is happening, it will be actually reflected in our better GRMs. Thank you very much. Thank you. The next question is from the line of Manikanth Karri from Axis Capital. Please go ahead. Good afternoon, sir. Thank you for giving me the opportunity. Just a couple of questions. Can you please provide an update on the gas business in terms of how many CNG stations were added in Q3? Specifically, if you can give the CapEx that we are spending towards the gas business in FY 2021 and 2022. That's the first question. The second question is, post this petchem project that we are targeted to complete at Kochi Refinery, just wanted to understand our three to five years perspective, if we have any targeted crude to chemicals conversion ratio for the refineries. Because it looks like all the other refiners in India, including your PSUs, also are targeting some crude to chemicals conversion ratio. We will take that gas side. I will answer the gas crude to chemicals. We have no intention to go from crude to chemicals the way Reliance has announced, because we are predominantly a domestic player, and we see a good potential for the liquid fuels to remain here in this country, at least for the next 15 years. Though the growth rate may probably taper, there is enough potential for us to make money out of diesel and petrol sales, and therefore it is not our intention to convert all the crude into chemicals. Let me make that very clear. Secondly, we also have plans ahead for increasing the in the basket petrochemical share from what, less than 1% to almost about maybe 10% in the next 10 years. That's the petchem side. Petchem, again, is a product which has got fluctuating fortunes, because the prices vary widely. There's a risk inherent in this, and it has got environmental impact also much more than what is caused by the petroleum products. We are very conscious of the potential of petchem, but we are not hungry at all about converting all the crude 100% into chemicals. Yeah. On the gas side, if you could. Okay, sorry. If you can supplement this, please. Yeah. Yeah. To answer the gas question. As on December 31st, in 527 ROs, CNG facility was there. About the CapEx in gas business, so our BGRL, which is 100% subsidiary, we have a total of 13 GAs. Four GAs is in our books. Total CapEx of around INR 8,300 crores is planned over a period of eight years. Thank you. The next question is from the line of Vidyadhar Ginde from ICICI Securities. Please go ahead. Yeah, thank you. My question was on this PDPP project. Can you give us some idea on, at current margins, at what kind of utilization level will you start making money? No, we won't be able to give the answer to this at this stage. We can give an offline answer to you subsequently. Basically, when you said 2022, you don't expect much contribution. Is it got to do with the utilization? It has nothing to do with the utilization. I'm saying that we are having a profit of about INR 8,000 crores on a consistent basis. On an INR 8,000 crore profit basis, any amount of PDPP in 2022 cannot make a significant impact. It is not a problem with the PDPP plan, the way it's marketed. The sheer size of our profits are very huge, and PDPP is a very small segment in a whole BPCL ocean. Please don't be under the impression that PDPP is going to change the fortunes of BPCL. BPCL is a consistently performing company with a profit after tax of more than $1 billion a year. On that number, PDPP profitability cannot add a significant impact, but it will improve the Kochi Refinery's profitability in a significant way, especially because of the suppressing crack spreads which the refinery business is experiencing. Okay, thank you. My second question was on Numaligarh. Earlier, you had been suggesting that you would like to have the Numaligarh deal also to happen parallelly along with or at the same time as the BPCL privatization. Why this change? Is it because of your own decision or is it because of Government decision to finish it, trying to finish it before March 31st? No, actually speaking, NRL deal ideally should have happened almost simultaneously. It is not possible to handle that simultaneously because government decision is to sell BPCL sans NRL. NRL deal has to be completed because the new owner is not expected to get anything out of NRL, right? Sure. Therefore, ideally, that deal should have been having a gap of maybe one or two or three months time. Since this is an indication that the BPCL deal is actually progressing, and that is one. Correct. Second thing is that we have also, as a BPCL, from our side, we can say that we are actually ensured that we have entered into a product offtake agreement with NRL. This said agreement is there for 15 years for us to take the products of NRL on a best endeavor basis for 3 million tons of the production capacity, and BPCL will not be affected at all in terms of product availability in spite of the disinvestment of NRL happening. We are sitting very pretty on NRL, and it is our desire to complete it sooner so that it can pave way for the government's decision to divest BPCL fast. Thank you. The next question is from the line of Siddhant Dand from Goodwill. Please go ahead. Yeah. Sir, you mentioned in one of the previous questions that even you find the share price of the company quite low. Why not consider a buyback instead of so much dividend, where the government can also participate and get their share of revenue, and investors can also be happy? Yes, it's a good suggestion. I said because I'm the Director of Finance of Bharat Petroleum. Therefore, I feel personally that the share prices today does not reflect the potential of BPCL. It's an investor's call. It is for the market to decide the price at which BPCL shares should be traded. Now, to answer your specific suggestion as a buyback as a method to increase the share prices, difficulty is that the Government of India holds only 52.98% shares. If I buyback, the government shareholding will further come down. We are anyway slated for disinvestment soon. It will not be possible for us to change the capital structure at this stage. Okay. That would be because other PSUs have done a buyback recently, and it worked very well for them, and their shareholders are much happier. It is so. Okay. Please. Thank you. Thank you. Ladies and gentlemen, due to time constraints, that was the last question for today. I would now like to hand the conference over to Mr. Harshvardhan Dole for closing comments. Thank you. On behalf of IIFL Securities, I'd like to thank the management for giving us an opportunity to host the call. I'd also like to thank all the participants for joining and asking active questions. Thank you very much. Over to you, sir, for any last comments. We would like to thank IIFL Securities for organizing the conference. I would also like to thank all the investors and analysts for their active participation. Thank you. Thank you from management.