Good day, and welcome to the Hindustan Petroleum Corporation Limited Q1 FY 2027 earnings con ference call hosted by Antique Stock Broking Limited. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an oper ator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Varatharajan from Antique Stock Broking Limited for the opening remarks. Thank you, and over to you, sir. Thanks, Alarik. Good morning, everyone. It's my pleasure to welcome all the participants, as well as the top management of HPCL. Today, we have Mr. Vikas Kaushal, Chairman, Managing Director. Mrs. Srividya Venkataraman, Director Finance. Mr. S. Bharathan, Director Refineries, and Mr. K. Vinod, Executive Director Corporate Finance, with us. I'd like to take this opportunity to congratulate Mrs. Srividya Venkataraman on taking charge as Director Finance and wish her all the best in the role. I'd like to hand over the call to Mr. Vikas Kaushal for the opening remarks. Good morning, everyone. Pleasure connecting to you early in the morning, on a Friday morning. Thursday morning. I was thinking it's Friday, but maybe I need the weekend soon. This is our first quarter one analyst call. Before I get started, as was introduced, I'm joined by Mr. Bharathan, Director Refineries. Srividya, who's just joined us as Director Finance recently. We are very privileged to have her as part of our board, and this is her first call, and I'm sure you're going to hear from her no w and even going forward. K. Vinod, you know from the past, and all the other colleagues. I was preparing my opening thoughts for this, and that we'll follow the same pattern which we've been doing in the last call. I'll speak for five, seven odd minutes and then open it up for a Q&A. We last spoke on 13th of May. I was reflecting last night as I jotted down some points on what the quarter was. It seemed to me circle of life and twice over, in this quarter. It almost seems we have seemed to live a lifetime. Why did I make that comment? Well, we had the Rajasthan refinery. There was a high on 20th April, waiting for the inauguration. Incident of a small fire in the CDU, we had to postpone it, and then we recovered from that, and July 4th, we dedicated that asset to the nation. That was one circle of life. The second one was on the performance. 13th, we spoke on a high of INR 17,175 crore of FY 2026 to the negative of this quarter, which I'm sure you have analyzed ad nauseam since last evening. That's the second circle of life. These are times we live in. You all have also agonized it on Excel sheets. We have agonized on it on a daily basis over the last quarter. Lot of challenges. We'll talk about it, but very proud of the way our team fought it on a daily basis, bravely, and managed to keep the supply chains going in times of high uncertainty. At moments like these, we take high and low in our stride and move forward. Coming to the current situation, I will not talk much about it. All of you track it. We know the uncertainty which prevails. Just one benchmark talks about it. What was crude 30 or 40 days ago? What was it 20 days ago? What is it now? That's a highly uncertain situation. It poses four key challenges to any team like ours, which is operating on it. First, extreme uncertainty on price. I talked about crude. At one point in time, you are taking a benchmark, Brent is going into 110 and 115. You are buying it in one and a half, two months in advance, then suddenly it drops $25. What do you do with that inventory? By the time you figure that out, it goes up to 96. Extreme uncertainty on prices. Also not only on the crude, also on the cracks. C racks have been less volatile, though they have been consistently high. Second, on an operating basis, we had to take, or any refiner had to take a lot of decisions based on availability rather than optimization. During this period, most refiners, most certainly us, could not run the most optimal crudes we would have wanted to run for our assets for a very simple reason. Some of them were sitting on the other side of the Strait of Hormuz. There is no way of getting them out. A lot of non-regular crudes. The idea was to keep the throughput going. As a refiner, which is a refining and marketing company, which is working to keep the wheels of the nation in motion, we had to make sure the throughput was there. We didn't have that option of going down on throughput, or we didn't exercise that option. Third, there were demand pressures. If some of you have tracked the industry, there have been spike in the demands. There were days when our supply chain was required to put in 40% more product into the market. Those are not things which are usual. You can all imagine what kind of challenges exist on the supply chain. Last point I wanted to say, it's a constant challenge. Many of us in services industry, I belong to that industry, often get Saturdays and Sundays. I would say our teams don't get that also. The fact that it is now going for 120 days, it leads a lot of tear and wear. Having said that, I will once again reiterate, I'm extremely proud of the way HPCL has performed Notwithstanding the numbers, and I know we will get a lot of questions on the numbers, we are ready for that. The organization has delivered under the crisis, kept the assets running, and it's managed to keep the customer expectations going. As I said, it takes a lot of effort to manage the crisis and the teams are focused on it. As we were doing it, we are also keeping an eye on the future and taking some fundamental improvement initiatives. The numbers are all there. I'm sure everybody's looked at it. I chanced upon at least three or four flash report from analysts. I read them, very fair observations by many of you. We'll address those questions in our time. What I wanted to cover in the remaining part of my opening dialogue are just two things. One, just a couple of key events which have happened in the recent past. Then I want to talk about, which I'm sure you want to hear, what is our response strategy to the current situation. On the event, the biggest one was HRRL. Finally, we have a running refinery in Rajasthan's first refinery. We declared scheduled commercial operation on 22nd June. The refinery is ramping up as of now. CDU is running at 60% capacity utilization, slowly we will get other trains of downstream units going up. Diesel, MS, lot of other units are there. Likely today, tomorrow, PFCCU, which is one of the money spinner units of the refinery, is also going to be in line. A lot of effort has gone onto it. We are expecting the refinery to ramp up to the full capacity in quarter three, petchem by end of the financial year. The refinery gains and running the CDU at full capacity would be at quarter three. During this period, we have already tested the CDU at a full capacity run for a period of couple of days. Right now we are running it at 60% utilization. Second was an exciting small pilot, I wanted to highlight it because it shows you the mindset on what we are operating at. Some of you might have got the news of our latest LPG product called HP Navya. It was launched on 15th July, which was our 52nd foundation day. It's an on-demand premium LPG product, sold through new channels, new look of cylinders, new delivery mechanisms, new channels. In Bangalore, we are piloting it with Swiggy. Right now, it's available in a radius of five kilometers, slowly will be ramped up. In Mumbai, we have started it through our own channel. We are expecting to hit five more cities by 31st July and 25 cities by 31st August, pan-India. It'll be mostly urban centric, pan-India, about 200-250 cities by Diwali, which is the game. The idea is to move some of the people who are willing to look for comfort, who are willing to look for better service, pay a price for that, LPG will be available in a different mechanism or different mode in India. No longer waits and no longer you will have to call up people to get an LPG cylinder. You can go and pick it up from your neighborhood shop. There are some other interesting pilots, which we are doing on use of biomass and fuel. I'll not talk of it there. In subsequent meetings, we'll probably cover that. Obviously, I'll come to the second point, which is the response strategy. You've all seen the numbers. As a management team, any such numbers disappoint. They don't surprise. You can always say there was a margin of surprise in the end because of, I would say, inventory, write-downs, et cetera. We knew what was coming, and we have prepared our response strategy on it. There is a 7-pronged response strategy which we are working on, I will elaborate that. At the end of it, I'll stop and open it up for questions. First is about improving our balance sheet. What gave us strength at this point of time was the fact that last full year we had improved our balance sheet. Those of you who had been on the calls will recall that our debt equity had changed from 1.43 at the beginning of last year to 0.8 at the end of the year. That gave us the headroom to withstand this crisis. Right now, it has risen up to 1.5 again. The debt is INR 72,000 crore. As we speak, we added about INR 1,900 crore a week during this period, last 13 weeks. This organization knows how to correct it. At the Ukraine crisis, the debt equity went up to 2.33. It came down to 0.8 in about three years. I'm very sure it will come down faster this time, and this will be one of our first objectives on making sure we climb down on the debt equity and create that headroom again. Very difficult to give a forecast given the prices there, obviously this is on top of the agenda for Srividya and other corporate finance team, which will be looking at it on a daily basis. Second, in response to the time is the CapEx control. As it is, we had set a lower CapEx. Most of you who have tracked us for a long time know that we are at an end of a long CapEx cycle. Things are starting to fall in place. Taking a bit more time than we would have liked in terms of stabilization, nevertheless, they are falling in place. We don't have to spend that much of money. Our annual target, which we have agreed with Government of India, if I remember correctly, is somewhere in INR 9,700 crore or in that ballpark. In the first quarter, we spent about INR 1,700 crore roughly. All of that is, I would say most of that is essential thing. You still have to spend on turnarounds, you have to plan for your turnarounds, et cetera. You have to buy the cylinders. All of it is going CapEx. At this point of time, we are Really focused on, especially in the short-term money outflow, on really critical CapEx. It's very tightly managed and prioritized. If the current situation prevails, we would expect the CapEx to be lower than INR 9,700 also. We want to conserve cash as a management team. Third response strategy is interest costs. With the rising debt, we do have interest costs, though they have been very tightly managed. Last year you saw how we came down on the interest costs there. Right now, couple of things we are doing, looking at all kinds of avenues for our parent balance sheet and also the HRRL balance sheet, which is the bigger subsidiary debt or joint venture debt we have. Obviously leveraging the ECB window, et cetera, are some of those things. The idea is to get our interest costs in control. The seriousness of this you can know from, if you track our receivables, you'll see how they have come down and have stayed down. Fourth response strategy is profitability improvement, making our assets work more. You had tracked us on the Samriddhi program last year. We came in with this about INR 1,600 odd crore. I don't remember exactly the split between recurring and one time, but the recurring ones have already been baked into this year's plans. Of course, with what happened in the first quarter, a lot of plans got topsy-turvy, like last-minute movements, et cetera. Nevertheless, we have reinitiated, after hit of support three months in the crisis, we have reinitiated Samriddhi 2.0. We already are working on 100 plus idea. We have taken, despite only nine months left in the quarter or three quarters left in this year, we have taken an aggressive target of INR 1,500 crore on a run rate basis, and we are going to aim for INR 1,000 crore on accruals in this. This would come in in three or four forms. There is obviously cost take-outs. There is also an emphasis on a top-line improvement. Again, happy to give you details now or later in the call, on one-on-one discussions. Then there are also some of the things we are trying to do more on intermediate movements, which can saturate our refineries, et cetera, better. More on that topic in one of my next response strategies. The fifth one is winning in retail. Some of you tracked, we are a marketing company. Very proud that we have been listed in top 20 brands in India across all sectors, across all companies. We have continued our efforts on increasing on the retail side. Last year we talked about retail improvement, Abhyuday. We had done it about 4,500 outlets. Wasn't the most successful program. As a management team, we would have liked it to perform better, but we learnt a lot from it. We have launched Abhyuday 2.0 at 4,900 retail outlets, and we have been at it for last three months. Of course, if I just wanted to give a metric of volume increase, then without doing anything, my volume throughput of my retail outlets increased because of the demand state-owned enterprises had on their retail outlets. We measure apple to apple, and getting good early results. From the measurable set, we are getting about 100 to 150 basis point higher growth on our 4,900 retail outlets. This is over and above the market growth, which is, I would say the tide rising, but our Abhyuday outlets are starting to outperform the non-Abhyuday outlets in the market. Parallelly, we are also focused on non-fuel. It's a small part of our bottom line, but nevertheless, something which starts adding to bottom line, and we are very hopeful by end of this March, we will start seeing this as a additional line on our P&L in terms of contribution. The sixth area is refinery improvement. That is obviously one of the biggest ones. We do have headroom on our refineries to improve further. There are three or four things which we are aiming at. First, in the next three quarters, as our refineries sort of settle onto the new paradigm, we are going to be increasing sourcing for our internal thing. One of the things which has hit us this quarter is our need to satisfy our marketing footprint by buying from third-party players. That dependence is going to slowly reduce. In fact, if I count my own refineries and the joint ventures, by end of this year, I would be almost self-sufficient, maybe surplus on some products, by taking in total of my own refineries and joint ventures. Two major efforts on this, we talked about HRRL ramp-up, and I'm sure that you're going to have questions on RUF. That also we have been in the process of stabilizing. It's a tough technology. We've had a couple of, I would say, unexpected technological challenges on it, because it's a high pressure, high temperature kind of a situation. Dealing with tons and tons of catalyst becomes difficult. We are mastering that art slowly and this will start giving us both product and consistently addition on the bottom line. In essence, we are making our assets work more. Our turnarounds are much sharper. They finish bang on time now. We are making a very concerted effort on energy costs because, between the two refineries on our balance sheet, we probably will be spending close to INR 2,000 or even more crores on energy. That's one effort. It'll be actually much more if you add fuel and losses. That's one effort we are doing. I talked about intermediate stream leverage. There are some interesting experiments we have done on buying intermediates to satisfy some of the units where there was potential to look at it. Whether it is VGO or pygas, we have been making those efforts. Last but not the least, with three refineries fully working and then even joint venture of HMEL in the fold, we are looking at even crude optimization across our refineries a lot more. Having the significant storage capacity at Mundra for HRRL gives us the flexibility of doing innovative things like bringing in VLCC there and shipping it to Mumbai in a different fashion. There's a lot of effort going on our refinery performance. The last but not the least, is the effort we've been talking about is on the digital side. Again, it's not only about just the fancy world of AI, but it's hardcore using digital to improve efficiencies. We've been talking in every quarterly call. From the last time to this time, we have launched the supply chain optimization solution. We're working on it. This will help us optimize our movements much sharper in a state-of-the-art tool. A lot of digital and analytics use cases are being worked on, and focus is on efficiency measures. Those were the seven I'll recall: improving our balance sheet, CapEx control, lowering the interest costs, profitability improvement program Samriddhi 2.0, winning in retail, refinery optimization and improvements, and digital. How do we look at the future? As the management team, we look at the future with a lot of confidence. I can look at the last quarter and say, "Oh, there is this negative." That's fine. It is there. I can't do anything to undo it at this stage. We are very confident of our future. A lot of foundational elements, some which we will talk and some which we will not talk in this call, are in place. The ones we will not talk, we want the world to see them down the line, and some of you guys to find it out yourself on how this happened. We look at the future with a lot of confidence. We will be turning around the current situation, hopefully by the time second call happens, you all would be happier with the numbers. We are coming out of the crisis stronger with a more balanced portfolio, and hungrier. That's all I have to say in my opening comments. Thank you for your patient hearing and also the continuous interest in HPCL. As I said, keep your detailed reports flowing. Even if you praise us or critique us, all of them are very valuable. I did mention earlier all the reports which came my way on WhatsApp since last night, the flash reports, I personally went through all. Very interesting comments and good analysis. Keep that coming. Of course, we are happy to take questions now, me and my team. Also, if anybody wants to meet us later, we are more than happy to meet you separately later. Thank you, and over to Varatharajan and the team for further moderating the call. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star 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 comes from the line of Probal Sen with ICICI Securities. Please go ahead. Good morning, sir. Thank you for the opportunity, and thank you for the very detailed and extremely useful briefing at the beginning of the call. I just had a couple of questions, perhaps from a slightly near-term perspective. You had, I think, spoken in detail last quarter in terms of the sourcing that you had in place and the kind of number of pages. Can we just get a sense, given the flare-up in the crisis again, how you are looking at sourcing? Q2, I assume, would have anyways been mostly tied up at this point of time. Looking forward to Q3, are you facing any fresh challenges in terms of arranging for sourcing, given what is happening in the Strait of Hormuz right now? What's the strategy then? What's the kind of mix, if any, in terms of how your crude sourcing is looking like? Specifically now that your Rajasthan Refinery is also up and running, obviously our crude requirements have gone up to that extent. Thanks, Probal. This is a dynamic time, just to be very predictive on what we are going to do on sourcing is very difficult. Just to give you a sense, at the beginning of the year, we always do a term and a spot mix. This time in the first quarter, we hardly got anything from our term contracts because a lot of the term contracts were sitting on the other side of Strait of Hormuz. Having said that, we are very well covered for our crude till end of August fully. In fact, yesterday, we were starting to buy for September. There is always barring one cargo which is stuck here and all, but those are operational things we are able to handle. I'm first talking of crude only, then I'll talk of LPG itself. I think crude availability is not an issue. Pricing, of course, goes up and down and is very difficult to handle given you are always buying Dated Brent and five months pricing or two months prior pricing. Less of a challenge on crude sourcing this time. We don't anticipate any issue on crude sourcing. There is enough crude which is available. In terms of mix, I think with what is happening and moment HRRL is at full steam, actually the mix plays more into our hands right now because, if you look at it, both of our bottom upgradations, RUF is still in stabilization phase as I said, and Rajasthan delayed coker is started, but a couple of units have to get on stream for us to get it full there. Moment HRRL, RUF is stabilized and HRRL is at full capacity on the refining section, we actually will be even more stronger positioned because we can buy even dirtier crude. On crude, I don't see an issue. On LPG, I think it's once bitten, twice shy. All OMCs have worked very hard to diversify the mix. One of the things, pre-crisis, all of our ships used to be looking at Strait of Hormuz and buying and turning up and down there. We've been buying a lot of cargoes from U.S. and other places also. I think LPG is much more. I think we have learned the drill. There is a lot of muscle memory now on how to do it. Of course, the situation is very dynamic. Bombs flying all over is a difficult thing. We will adapt at it, but I am not worried about pricing of either LPG or crude at this point of time. Pricing, of course, is a concern. Got it, sir. With respect to just the inventory movement that you mentioned, it is fair to assume that there would probably have been a negative inventory impact in the quarter, both for the refining and marketing segment, and that will probably reverse in this quarter given the kind of spike we are seeing in prices, or it is too simplistic to look at it in that way at this point of time? Yeah. I think part of the statement is absolutely correct, Probal. We did have a significant amount of inventory and also two things happened in this quarter. You should remember that it was very uncertain times to secure more inventory. At least we carried more than usual inventory with us. That was a conscious call we took because, as I said, we were first looking at keeping the throughputs going. Also during the month-end, some cargoes which are stuck in SoH, they landed. We did carry more crude into our tanks on 30th of June. Obviously, there is a write-down on those, given where the prices are. One can say, "Oh, you would have anticipated that drop." I will be wrong in saying if I would have thought the crude will drop $25 in a matter of two weeks there. To that extent, there will be a reversal automatically. How much? Very difficult to predict because it is now again going up at $95. If it goes to $120, there is a different reversal. If it goes down to $75, there is a different thing. In July onwards, we are carrying a reasonable amount of marked-down crude. We did carry a lot of marked-down crude. July, we have been running marked-down crude. Got it, sir. One last question, if I may, it's a housekeeping one. What was the LPG loss on a per cylinder basis for the quarter, and what is the kind of level we are seeing right now, if I can have them? I don't have the quarter number. June it was 680 per cylinder. July it dropped 490 per cylinder. Quarter things, my team can give it to you later, if you want the averages. I just have the June and July number with me. No problem, sir. Thank you so much. Vinod is giving some additional numbers. 510. INR 510 for was the whole quarter. For the three months. For the three months it was INR 510 per cylinder loss. All right, sir. That is very, very useful. Thank you so much. I'll come back. Thanks, Probal. The next question comes from the line of Puneet Gulati with HSBC Bank. Please go ahead. Yeah. Thank you so much, and great effort on managing the supply chain in these tough times. My first question is, if you can help me understand how should one look at the refining margin, which you say is without the SAED impact. When you transfer it within the firm from your refinery piece to your marketing piece, do you adjust for impact of SAED for transfer, or is it full price? How should one think about this? Adjusted for SAED. Yeah, this is adjusted for SAED. The reported numbers are adjusted for SAED. Even when our own refinery. Sorry, Srividya is just giving an additional data point. Even when our own refinery is transferred to the marketing, it's done after writing down the SAED. It's net of SAED, the transfer happens. Okay. Even when you transfer it within the domestic universe, it's an ex of impact. Okay. Secondly, on the product side, there was this price increase on petrol, diesel. Would it still have resulted in marketing gains or is that still counted as at the same price? For the whole quarter, there is a significant under-recovery on this. This has been said even on the public platforms by a lot of people, including high-ranking government officials. There has been a significant there. Just to give you a sense, the marketing under-recovery for the whole quarter was upwards of INR 26,000 crores, 20 of which was, and these are rough numbers, was on MS and HSD put together, and about remaining was on LPG. It was a significant under-recovery for the whole quarter. Every liter which you and I were buying from petrol pump was being subsidized by one of the three OMCs. Understood. Can you give a sense of, obviously, the pricing has moved up again. Is there still significant under-recovery at this point of time? If we account for a combined margin, are you in a better state and in a positive territory, add your refining spread with your marketing loss? Yeah, I think this is a very, very dynamic situation. Just in last three days, the crude has gone up, three working days, it's gone from 85 to 96. It's a very difficult one to predict and as it is, we have not given too many forward-looking guidance's, though we gave some last year. This is the least time as a management team we would want to give forward-looking guidance's. Having said that, I will say that we were happier with July. We hope we'll be happier with August, is what I would say. No point getting into specific numbers, because you guys can do your own backward calculations. You are very smart around it, but it's a very dynamic time. Before we speak tomorrow, if anybody caught the news today, one Saudi product tanker is on fire in the Red Sea. Houthis have done that. That's at least floating around in the media right now. I don't know whether true or wrong. It's a very dynamic situation. Crude could go 100 tomorrow or it could drop $10. We'll have to take it as it comes. We were happy with July. Understood. That's really helpful. Thank you so much, and all the best. Thank you. Participants, in the interest of time and fairness to others, please restrict yourselves to two questions. For any more questions, you may rejoin the queue. The next question comes from the line of Amit Murarka with Axis Capital. Please go ahead. Hi. Good morning, and thanks for the opportunity. Firstly, on the quantum of the inventory movement, would you be able to ballpark provide that as to how much was lost at crude or marketing? Same question, Amit, was asked last time. Again, you leave that with us as a number. All I would say, and I made that statement earlier, we were carrying higher crude inventory and we also were keeping sufficient product. In a normal situation, I wouldn't have carried that much of crude in my tanks, which I was carrying on 30th of June, because we were apprehensive that oil could go anywhere all the time. It is a significant number. I'll give you one more cue. My team is going to kill me after that. If you net it off, the loss number would have been on the other side of five-digit number by a good margin. Remaining, you can calculate yourself. Got it. On the Vizag bottom unit, you mentioned that you faced some issues with catalyst handling. Also, by when do you think you'll be able to stabilize that unit and start contributing fully to margins? At 8:45 A.M. today morning, my head of refinery told me that he's hopeful of getting it stable very soon. Now, I don't know whether he was awaiting that question. That's the first call I make when I leave home to get to work. Jokes apart, I think, let's also recognize that it is a very technically complex asset. I've given this in the last call also. Imagine running something at 380 bars at 400 degree temperature. I told last time, just to see how powerful that reaction is, the walls of that reactor are 25 centimeters thick. It's a challenging situation. We are learning the art of doing it. Even Lummus, who's the technology provider. This is the first time they're running a unit this large there. Again, it's a technological leap HPCL has taken. The good thing, it's an engineering problem, engineering problems can get solved more easily than financial or pricing problems. Our team is working on it. We are getting faster and smoother. We are hoping to have good run on that in this quarter itself, in the next quarter itself, hoping to have it fully stabilized there. I remain hopeful God will be kind to us in making our hopes get realized. It will start giving us a significant thing. It will also, as I said, significantly shift HPCL's with HRRL and Vizag RUF coming fully on stream. On a run rate basis, third quarter onwards, I would hardly be dependent on anybody except my own refineries and my JVs for diesel. On MS, I'll probably need only 10% MS from anybody else. We are in that phase where we are really hoping our assets will start working on it. As a CEO, I'm impatient for Rough to get started soon, as a practical person, I have to give my team the entire space to get it running and learn the technology. We'll get there. We are very confident about it. Thank you. The next question comes from the line of Yogesh Patil with Dolat Capital. Please go ahead. Thanks for taking the question, sir. Capital expenditure side, INR 1,734 crore kind of a CapEx during the quarter has seen a sharp reduction on the sequential basis. Could you please share the number that expected CapEx for FY 2027? In addition to this, suppose the FY 2027 CapEx might be on a slower or lower side. Considering that a kind of higher end recoveries on the oil products, which segment of our company, like refining, marketing, pipeline or CGD, will take a hit on the CapEx side? Any broader understanding if you could provide? I think I gave the understanding on the broad numbers. We said 9,700 was the target we had taken for the year. We expect it to be lower than this. Obviously, we will react to the environment. If the thing is benign in the next quarter, we will spend some money. If it is not benign, we will conserve that money. 1,700 odd, which we have spent right now, also includes a lot of money which has been spent on buying equipment, catalyst, et cetera, for the upcoming turnarounds, which are absolutely essential for keeping our refinery running. In fact, all of the refiners hav e been delaying turnarounds in the last few months to keep the product flows going. Which segments? I think a lot of it is around discretionary things. Things we would want to do more, like I can always upgrade 200 pumps in a year. I can upgrade 1,000 pumps in a year. If I have more money, I will upgrade 1,000. If I have less money, I will upgrade 200. On the refining side, the major CapEx has already been done. There are a few projects going on, but for a company of our size, spending INR 4,000 or INR 5,000 crore on a four-year, five-year long project is not too much of an issue. There will be periods where we can accelerate that spending. There are other things where we can spend in terms of, I would say, administrative expenses, upgrading some of our infrastructure. Those things we can always postpone. We can do it one quarter later. That's something the management team will take a call on. Nothing critical will be starved of funds, and yet the discretionary spends can be pushed back a bit. Okay. Touching to the same, any number you'd like to share with us for the FY 2027 CapEx? Secondly, sir, India has oil SPR reserves of around 5.3 million metric ton. Was it available for all of these Oil Marketing Companies or any refiner during the Q1 FY 2027, considering the sourcing? All reserves, all things were available to everyone. All I would say, not only HPCL, every single refining company and marketing company, private and public, collaborated extensively during these periods to get the country out of the crisis. The amount of collaboration which happened, I guess none of you can even imagine. SPRs were available. Our own infrastructure was available for others. Others' infrastructure was available to us. If I was running short on something, somebody else was helping me, somebody else was running short there. It takes a lot of people to work together to get over a crisis like this. It was a non-trivial situation. Many nations balked under it, we came out of it because all our companies, whether it is standalone refiners, whether it is private sector refiners, public sector, all of them worked very hard on this. On CapEx, I've already given you number. Beyond that, as I've said, this call is not about giving any guidance's. We have stayed away from that. We have said the maximum we are going to spend is INR 9,700 crore. If there is less money on this year, we will spend less than that. Thank you. The next question comes from the line of Nitin Tiwari with PhillipCapital India. Please go ahead. Hi, sir. Good morning. Thanks for the opportunity, and at the onset, I would want to congratulate your entire team for navigating this very challenging operating environment. Sir, my question actually was related to your refinery margins. Yesterday, along with you, BPCL also reported their numbers, and their refinery margins have been fairly strong as compared to our refinery margin. I just wanted to understand in that backdrop, what were our hits and misses, which led to this significant variance between two similarly sized peers, in terms of refinery margins. That is one. Secondly, you did comment on rough stabilization and other challenges that you're facing in Vizag, which perhaps could be impacting the refinery margin. But I was looking at the data for last 20 quarters, which is almost last five years. In this period, we have rarely reported refinery margins better than our peers, IOC and BPCL. I'm not even comparing it with refinery margins of private peers. What is it that is leading to this challenge in terms of our refinery operations, where our refinery margins are consistently lower? Because in the past also, we've guided for margins to incrementally turn better, with expansion of capacity at Vizag and so on and so forth. Your comments on that, sir, and then I'll ask my next question. Sure. I think on comparison, BPCL, I will leave it for you to do. Not my job to compare with BPCL. I've picked up the phone and congratulated the BPCL CMD on an exceptional performance from their side. Proud of peers turning out what the numbers are. I have not spent time trying to dig through what were their refining margins. I have enough of work on my hand to do on what are my refining margins and where do I want to be. I leave that comment on BPCL to you to handle. Remember, they have a higher refining capacity than we have. There are structural things. Refining is not just an easy job to do, it's a complex thing. On your second thing, I would turn the clock forward. One year later, you should ask me the same question on the same call, and you will have an HPCL asset which will have the highest margin. See, the margins are generated by the assets we have. If you understand refining and go deeper into that entire thing, you will understand there are. If I do not have a delayed coker in my Mumbai, I will not get a refining margin, or uplift, which, say, another refinery which has a delayed coker, which will have. I have a delayed coker which is already working in HRRL, and I will get that uplift out there. Second, our uplift on rough will happen, at Vizag will happen. That will take our distillate yields up from what it is right now to in 80s. There is also a structural disadvantage Vizag has too. One, if I compare it with a West Coast refinery, that's in East Coast. You always have to carry more inventory in East Coast. The crudes are more expensive on East Coast. That refinery also does not have natural gas right now, which my other refineries have. It's not just an apple-to-apple comparison that if you look at one reported number and compare it with other and say, "Oh, this guy is good and this guy is bad." You have to look at what is that guy capable. I have two kids. If I have two kids and one is capable of cracking IIT and the other one is not capable of cracking IIT, should I say that the second kid is bad? No. I have to look at what is that kid's capability and what is that kid performing on that. Having said that, we understand we need to improve that entire thing, we are on track to improvement on that. I hope I've answered your question. Yes. Sir, actually, what I was trying to get at is that, as you rightly pointed out, BPCL has a larger capacity, right? I mean, in terms of refining. Naturally, they would also be carrying a larger inventory. While we were carrying more inventory than we usually carry, I suppose like you saw also did, BPCL, and I'm not getting into specific numbers- I can't tell you BPCL's number. For BPCL, you have to go to BPCL's analyst call and ask that question. You can't ask me questions on BPCL on this call. Fair enough, sir, I'm not asking that question on BPCL. I'm just trying to understand the difference in the operation of refineries which could have led to decrease in margin. Fair enough, I take your answer for that. Basically, I also wanted to understand this quarter's refinery margin somewhat in detail. When you say it's before SAED impact, right? If we build in the SAED impact, then what would be a refinery margin to look at? If you can give us a, I mean, I understand that you don't want to give an absolute number on refinery inventory losses, but a ballpark number around per unit basis would be helpful for us for our analysis. Yeah. I think you guys are all smart to calculate the SAED impact yourself. If you need help on that, you can always speak to my corporate finance team, Vinod and the team. They can help you understand the SAED impact, the way you looked at it. What was the second part of that question? Inventory, I've already said what I have to say. I will not say anything further on inventory. Thank you. The next question comes from the line of Sumeet Rohra with Smarts un Capital. Please go ahead. Hi, sir. A very good morning to you and your entire team. Sir, firstly, I have to congratulate you. It's a very tough environment that you guys have basically been functioning on and, more importantly, kept this country alive. I mean, sir, one thing, it's clearly a fact that the private guys were basically, in terms of market share, also small. What you have done, I mean, all the three of you have been totally marvelous. I'm sure that the country is definitely indebted to you because you've kept the wheels of the country running. Sir, my question to you is that, the matter of fact is that you've done such great amount of work. Your balance sheet has taken a hit. Of course, sir, you have done this for the country. I mean, there's absolutely no question on that front. As we've seen that our LPG today underrecoveries or whatever the negative buffer account is about INR 16,000 crore. Your marketing also has been subsidized for the best interest of the country, which is nearly to the tune of INR 20,000, as has been highlighted. Sir, I'm sure that the government is obviously aware about the sacrifice which basically the company is making. Obviously the sacrifice also comes from its shareholders, right? Because the economic interest of the shareholders also is at stake. With the great amount of work, the physical work which you guys have put in and the financial hit we've taken, and with INR 26,000 crore of under recovery which you've just faced in three months, which is staggering. Sir, can we expect that we can expect a substantial amount of government support because this is done for the country itself? Can you please share, if at all possible, your outlook for this financial year? As you said, it's a circle of life, 2022 also we faced a similar period and come four years ahead, 2026. I'm sure that what you've done is a splendid job, I'm sure this company is becoming stronger and stronger. That is clearly evident from the refineries, from the physical throughputs, from the physical outperformance, which you guys have done. Sir, from the financial point, it'd be very interesting to get your perspective in that, I'm sure the government looks up to you guys for the great work you're doing. Thanks, sir. Thanks, Sumeet, and thanks for your kind words. On the aspects on how, First, it's not my brief to talk on what the government's going to do. I think there is a different set of people who should be talking on it. The questions probably are best addressed there. Having said that, There's been a lot of talk and government's been talking about the fact that there was a way things had happened, and there was something which was done to keep the wheels in motion in this way. I'm sure all those things would be taken into account. They have been taken into account in the past. I'll draw your attention onto what was said at the analyst meet in Bombay last year, where the then secretary and also the honorable minister actually talked about saying that how the fact that these assets are bulwarks of keeping the wheels of the nation in motion. A lot of, I would say, support is there in different forms. What specifics? This is not the right forum to talk about that. What's our outlook? As I said earlier, very difficult times to predict the outlook. You guys have been tracking this oil market for years, you will know. Probably you never have seen the extreme volatility which is occurring right now. There have been eras for high prices. There have been eras of $20 prices also. The spikes and the troughs which are happening, the frequency of the volatile nature is kind of unprecedented, and that has its own set of challenges in giving a guidance. Having said that, we are very bullish about the future. Why? Two, three things. One, we believe a lot of homework has been done, some obvious, some not so obvious, some giving results right now, some will give results in the future, which make us a stronger company. The fundamentals of the company are being worked upon. All of us are together in it. Everything which is there, work on it. Just as a simple thing, while we did not share, and I refuse to comment on BPCL's team, our teams have been analyzing everything threadbare because we also want to see where is an improvement area in us. Not only us, we are looking at every single result which has been declared to find out our improvement areas. Similarly, I talked about lot of effort going on into marketing side. We talked about the new LPG launch. All those things are things which make the company stronger in the long run. I hope benign conditions come. If that looks at it, no management team ever wants a red quarter or a red year. We are also a team which are very proud. We will also not want to have red quarter we cannot avoid at this time, but we would also not want to have a red year. That's all I would say on this, Sumeet. Hopefully quarter two, the results will be better. We can be more sure about where the year is going to end, but very difficult to predict at this point of time. Okay, sir. Thank you so much, and wish you all the very best. Sir, because the only reason I brought this point up is because today the market cap of INR 80,000 crore clearly is not justified for the kind of valuable assets which the company owns, right? Today our plant and machinery value is INR 1 lakh crore, whereas we are being valued at INR 80,000. It just absolutely is absurd valuation. That was the reason I just brought this up. Anyway, wish you the best of luck and to you and your entire team, sir. Thank you. The next question comes from the line of Abhishek Nigam with Motilal Oswal Financial Services. Please go ahead. Hi. Just two questions. Sir, what is the landed cost today for crude? If Brent crude is $90, then what will be the landed cost in India? That's my first question. Difficult to answer in any way because it'll depend on where you are buying, what crude you are buying, because you could buy an extremely light, low sulfur crude, which is at a premium to Brent. There are other things. There could be a seller which just wants to get rid of a cargo. It's a very difficult question. If you ask me, what is my landed crude today of all I'm buying for my refinery right now, I won't be able to give you that number also because it varies literally from crude to crude there. My suggestion is from your calculation purposes, just look at the averages rather than getting deeper because crude buying is also there are 200 different type of crudes floating around in the market. If we just take Brent, for example, if we're just buying Brent, is it fair to just add the shipping and insurance? Is there some average number that you can give, $3, $4, $6 in terms of? It is like you are asking me to predict the oil prices. I was just thinking as you are asking that question, I have no way to give you, and I will throw it open to my team if they have any better guesses. Even in this crisis, there are times when you have picked up crude which are discount to Brent. There is some other crude which is at a premium to Brent. Every crude goes in at a different thing. There are times when today that crude is at a premium to Brent, two weeks later, that is actually at Brent, one week later, it might be at minus to Brent. Everything is shipping and all is very standard. Of course, shipping rates went up in the recent past, but that's a standard thing. I'm not evading that question. It's just that I don't know how to answer that question. I wish I had that straightforward answer to that. Fair enough. Sir, just one last question. Last quarter, I think in June, there was a $200 premium on LPG buying. It was a spot premium. Is there still something like that prevalent today? Or has that completely gone away? I think two things have happened. One, the Saudi CP price, which is one of the markers, has come down by about $200 per metric ton. The second, as a reaction to the crisis, we have also diversified our LPG procurement mix. There are, like last time, we were almost, in the call also said, and it's been said in public domains by a lot of people that we were all dependent upon 90% on LPG coming from other side of Strait of Hormuz. That dependence, of course, it was not available, but even otherwise, there's a systemic diversification which is happening. There are Indian time charters which are going to U.S. to pick up cargoes, which never happened in the past. Because of the diversification, I'm less dependent on the spot. As a result, the spot prices have cooled down there. I don't know what is today after the latest hits which have happened. By and large, they have cooled down a bit. Also we are much more resilient in the way we are buying right now. Okay. I think that helps, sir. Thank you so much. That's it from me. Thank you. The next question comes from the line of Maulik Patel with Equirus Securities. Please go ahead. Hi. Thanks for the opportunity. Sir, just two questions. Sir, you already mentioned about two things which led to the subdued performance in this quarter. One, you were carrying a little higher inventory at the end of June, and you had that sharp fall. Second is the Vizag upgradation refinery performance. With that, if both things normalize in your expectation, if you're not carrying even a higher oil inventory and the Vizag performance would have been normalized, which you expect in Q3 or Q4 onwards, what could have been your GRM, which you had reported around $24? Just some idea on that, what could have been your number if these two things are not there? I think difficult to give you a number offhand on that. When I made that statement, you have to look at it in the context of the quarter. If those things were, I would say, things which have moved the needle a bit to the other side of a five-digit number. Remember, we talked about the overall under recovery of INR 26,000 crore. That itself is a big number, HPCL, on its own balance sheet, carries about 55%-60% of our total POL and other products there, if I keep LPG out of it. Approximately 55% is supplied through our own P&L. Some part is supplied through our joint venture. We would always have that complexity of some of the numbers, even in the best of the times, falling through the consolidated numbers and others coming through the P&L there. Let's wait for a couple of quarters when all these things are normalized. You will start seeing the uplift in the GRMs. Right now, one thing you should all keep in mind that when you're looking at GRMs, everybody buys crude, which is on dated Brent, some with one month, I think there were some with two-month pricing. This was unusual period, a high GRM is not only a reflection of a performance of the refinery, it is also a reflection on the timing there. Just to give you a sense, again, there are days when I'm running a particular parcel, my Vizag refinery has given me above $30 GRM. Next day when you look at the dashboard, first thing on your thing, they're saying, "Yesterday it was positive. How did it become negative?" Because next day they are starting to run a different, which is at a different price. GRMs fluctuate based on the crude which you are buying. Refinery consistency and their performance is a structural thing which can be altered over a period of time. On a daily basis, if I had cheaper inventory in some days on a particular fortnight, say, my GRM could be sky high. Sir, if you could have an access to the Middle East crude in this quarter, your Vizag refinery performance should have been much higher than what you have reported. Is that an fair understanding? In some ways, yes, because a lot of units in Vizag, you all design to certain specs. There is some part of Vizag which is designed to a spec, maybe Director Refineries can add to it. He's much more knowledgeable on this topic than I am. Yeah. In fact, many of our term contracts are targeted at Iraq and Saudi crudes, ADNOC also. Quite a few of them, almost none of them came. The alternatives are not readily available in the market with the same quality. That whatever impact that we had seen that and gone through that. Thank you. The next question comes from the line of Gagan Dixit with Elara Capital. Please go ahead. Yeah. Thanks for taking my question, sir. I have the question about the Vizag refinery. Your auditor highlighted that there is an INR 26 billion loss in the Vizag refinery, while your headline numbers at the refinery level, its GRM is very decent at $24. Can you explain what is that refinery level profitability versus the headline GRM? I don't know. Yeah. Did you get the question? No. He can repeat the question. Can you repeat the question? The line had a static in between. Yeah. Sir, my question is that your auditor highlighted that at the Vizag Refinery, there is the INR 26 billion loss. It is mentioned in the notes, actually. What is the reason is that, despite the very strong GRM you reported, sir? They are just checking up. The team is just checking up. You can take, maybe. This is INR 2,635 crore. That is after factoring the inventory losses at Vizag. Okay, sir. It's only the inventory loss. Yeah. Okay. Sir, my next question is that, what's the utilization we expect for the Rajasthan refinery in the September quarter in FY 2027, sir? Sir, how much is the product that you purchased from the third party it is expected to replace at full utilization level? Sorry, can you be repeating the question? There's somehow static or what. [inaudible], if you got the question, you can repeat it, because at our end we are getting some static when the question is being asked. Sir, my question is about the Rajasthan refinery, sir. What is the utilization I expect for the September quarter, and also from FY 2027 basis, sir. That's my question. Please repeat. You just dropped off from the line in that period. Gagan, in case if you're not using the phone on your handset mode, please use it on the handset mode. Yeah. Is it better now? Yes please. Yeah. My question is that, this about the Rajasthan refinery. What is the utilization for the September quarter and FY 2027? How much is the product third party that you purchased it is expected to replace at the full utilization level? Okay. I think utilization, as I said, we are running at around 60-odd% right now for the whole. It's a new refinery, so there will always be a few things here and there. But overall, for this quarter, we are expecting 50% or thereabouts utilization. We are not going to hang our team for plus/minus on that because it's a new refinery ramping up. Refineries take time to ramp up. On Q3 of this year, maybe October onwards, we are expecting an 80%-85% utilization run rate. By Q4, we expect it to have close to full utilization on the refinery section. Petchem, as I said, will take some time to ramp up. But till that time, we'll be able to sell the other products, including LPG, which is always in demand. We are going to start, literally from today or tomorrow, we are going to start producing a significant amount of LPG at the refinery. On FY 2028, we would expect a full run on the refinery. We are quite hopeful of that getting stable soon. In terms of what we are buying, so if I just look at Q1, just take HSD as an example. We bought about 50% is our own, another 27% is through joint ventures, HMEL, where we have the marketing rights for the liquid products, and another 24% was bought out. If I just do fast-forward to next year, 56% of that will come from my own, including the rough things, 40% will be from joint ventures, because HRRL will kick in at that point of time, and only balancing will come from third-party refineries. Balancing more from, there are some places where it might be better to buy from them because of better service ability, especially in down south. That's the dramatic shift we are expecting in the next 2-3 quarters, which will, as I said in my opening remarks, which will structurally alter our numbers. Then obviously with HRRL coming in and kicking in at good numbers, we would have a different set of comparisons to do next year. Thank you. The next question comes from the line of Mayank Maheshwari with Morgan Stanley. Please go ahead. Thank you for the call, sir. I had two questions, one for Srividya, ma'am, and one for you. On the seven points that you mentioned in your opening remarks, you talked about those changes. When you're thinking about these dynamic markets that we are in, where do you see the maximum room for improvement, especially you had got all these questions on refining in the previous participants. Where do you see the maximum room for improvement, and where do you think you can uplift margins, either on crude sourcing or on energy cost you talked about? Anything else you think you need to be more agile with in the refining side? And on the finance question I had with Srividya, ma'am, was more related to interest cost. I think the JV debt plus your total debt, how much room do you see in terms of lowering your cost of interest in terms of over the next one year or so? Thank you. You want to take the interest question first? Srividya is going to answer first. Hi, Mayank. As far as the interest cost is concerned, yes, definitely, it's a major concern for us, more from the JV perspective, if you look at it from the HRRL perspective, wherein they have some high-cost rupee term loans which they have. As they now have completed their commissioning. There are two prong approach. One is to see as to how we could refinance a portion of it. As you are aware, RBI has come with a fully hedged ECB, which can be used for at least a portion of it, which could be refinanced, and that will definitely give them a leverage of a minimum of 1.5% in the terms of the ECB. The other one is that, once that it is known that the refinery has been commissioned and there's been a stable operations, then we would be able to go back to the banks for repricing it. This is going to be the two-pronged approach for HRRL. As far as HPCL is concerned, in terms of the interest cost, the cost is not a concern for me, the more is in terms of the debt, in the overall size of the debt which is there. The entire approach is going to be in terms of how do we downsize the debt. Downsizing will automatically bring in the impact of my interest cost, the finance cost overall coming down and bringing the benefit and the improvement in the profitability. Hope that answers the question, and [audio distortion]. Thanks. Thanks, Mayank, and I did read your one-page flash report. I always like the analysis you guys put together, even when it is not favorable to what I would like it to be. Nevertheless, it was a good, quick analysis. Thank you for that. Keep it flowing. I'll try to give it a more holistic answer to it. It also tells you how, as a management team, we are thinking about it. When we are at a moment like this, there are two things you have to do as a team, which is leading a large team, large asset base, and has a lot of those things. Of course, you have to do the things of keeping everybody motivated, keeping everybody excited. We have a different task of how do we motivate our people after the loss numbers yesterday. We are again doing our town halls and talking to everybody and talking about our future there. As a management team, there are two things we are looking at it. One is, what are we fundamentally altering? Second is what helps me immediately in the short term. That's how I would answer your question on those seven parts. On what could help me in the short term, frankly, it is crude sourcing and optimization. More volatile the environment is, more opportunity exists for short-term optimization. There is a lot which we have done. Unfortunately, as I said earlier, we did carry a lot more crude on 30th June, and we didn't think the bombs will stop or the crude will drop $25 in a matter of a few weeks there. There are some very fundamental things we have done, like for example, I talked about HRRL coming on stream. There's a COT which is at Mundra. We sometimes bring in VLCCs and we use smaller ships to transfer to Mumbai, which allows us structurally to avoid route cuts and gets it cheaper into Mumbai. Things like ship-to-ship transfer, all those kind of things which allow us structurally to alter. There are opportunities there. There was a mo ment, one day we were very happy because an event happened and we had just negotiated a spot cargo. An event happened, and we renegotiated it. We got $6 off. On a VLCC, getting $6 off, it's a lot of money. 2 million barrels, $6 off, you can calculate that number. I think that opportunities exist in the short run. Second, in the short run, Samriddhi will give me benefits, and I'll talk of Samriddhi benefits in a minute. There are two, three things. We're obviously sharper on costs. HPCL has a good cost consciousness. Last many quarters we have been at it, so every bit, small and big, matters. Just as a context, while it is a different form, tomorrow we have a event where 1,600 of our people have participated in a digital hackathon, 499 ideas for improvement. 30 of the final teams are going to be at a training institute, and all of us, as the leaders, are spending the whole day with them, looking at their ideas. That's just building a bottom-up swell on many of these things. Those ideas will definitely give us benefit. There'll be short-term spikes on, or short-term uplifts on things like, I talked about using VGO for something and biogas, and all those things, look at it. Those are short-term lifts. As a management team, the second prong we are working on is the fundamental shifts which we are doing. Slowly moving things. You might see the HP Navya Gas, which we have launched. Somebody might say, "What will it do? You do nine crore cylinder." If in a matter of two, three years, if I'm able to move 50 lakh cylinders to that, I move the needle on certain other things. Similarly, there is branded fuels. Again, I don't want to talk more about it. You do your own research, but you'll find out that HPCL's doing quite well on those. It does not show up on the numbers right now, in two years it will start showing up on the numbers. We talked about supply chain optimization tool, which we are implementing. It will not give me results this year. If I have to do further optimization, I still have to rely on Excel sheet. Next year, when the crisis or anything happens, my team would have a state-of-the-art latest digital optimization tool which can allow them to do unplanned movement much more faster. Another area I'll talk of, RTCs and RTUs and APCs in our refineries. We are making sure that all refineries, except HRRL, we'll do it a bit later because it has to stabilize. Both our other refineries are going to have a saturation of all those units. Wherever we have started measuring, we are starting to get 0.4%, 0.5% uplift in the yield, et cetera. There are a lot of fundamental things which are there. That's why I made that comment at the closing part of it. We are bullish about the future. Yes, there is a short-term hiccup, we are very bullish about the future because there are dozens and dozens of those things which we are doing. We have a very charged up team. I told you, 1,600 of my colleagues participated in it. There are 499 ideas which came out of it. They might be good, they might be bad. Somebody might say INR 5, somebody might say INR 500, and some might say INR 5 million. One-fifth of my employees participated in it. It's an exciting thing for a management team to look at it. Those are the fundamental changes we are attempting to make, which we'll look at it. Of course, from a quarterly results, the first bucket, opportunistic, intermediates, some energy costs, some frugal cost takeout, those are things which should help in the short term. I hope I've answered your question. Yeah, Vikas. Thank you for that, and hope you get more $5 million kind of ideas. Best of luck. Thank you. The next question comes from the line of Nikhil Bhandari with Goldman Sachs. Please go ahead. Yes. Hi. Thank you so much for the opportunity to ask a question. I've got two questions. Firstly, on the Rajasthan Refinery. When we look at the globally complex refining and Petchem greenfield assets, they faced steeper stabilization curves compared to the brownfield expansions. Given your recent hands-on experience with the intricate commissioning and unit integration at the Vizag, what specific operational learnings are you carrying over to the Rajasthan complex? Also, if you can walk us through the major commissioning timelines between now and December 2026 or March 2027, when you expect the refinery part to fully ramp up for this refinery. Just to understand the confidence this asset will beat the typical industry curve for a timely ramp up. That's the first question. Sure. Nikhil, I'll attempt a quick answer, then I'll request Bharathan-j i to give more details. You all know him from asking, knows this subject well. I think we are actually very excited with what has happened on HRRL in the recent times, especially after how our team bounced back after the CDU fire incident. We had a sequence, and I'm talking in layman's term. Bharathan-j i will explain in terms of technical details, more detail. As a layman, I would say we had a sequence of commissioning which was lined up. CDU, then DHDT, DCU, those kind of things which were lined up. Lo and behold, we had the CDU started. We were hoping to sort of do the commissioning at that time. At least the starting at that time and commissioning few weeks later in April, when this happened. That caused us to do rework, take a shutdown in CDU. In June, we commissioned four or five major blocks within fortnight or maybe, say three weeks. This include recommissioning of CDU, DHDT, the diesel hydrotreater, HU, which was always working, we had taken a shutdown, we restarted it. We also committed the amine systems and the sulfur block, et cetera. Those, we all got it going. Delayed coker, I talked about it. In fact, pet coke was the first product we commercially sold from there. It probably is unheard that a refinery got all the units in three to four weeks, everything got commissioned, because we had the deadline of June end to get the scheduled commissioning. What we did as a team is we pulled in best of our people from Vizag and Mumbai, and 150 of our people are stationed in HRRL right now to assist the teams on the ground to make sure their set is up. As I said, PFCCU, which is the Petro Fluidized Catalytic Cracking Unit, is literally on the block of commissioning right now. It's a matter of hours by which we will be able to commission it. With that, from my perspective, bulk of the units on refinery are commissioned. There are some units where we have a single train, like in DCU, we have one train working right now. Second train should work in next two, three, four weeks, somewhere. We have enough to process there. The block which is left for full commissioning is SRU, which we are hoping by end of this quarter, give or take a couple of weeks, would be there. At that stage, all refinery units more or less would be done. There could always be small things. Come October end, we would expect the refinery to run at 85%-90%, small things here and there. Bharathan-ji, you can add with your. I think timelines were given when the chairman gave the opening remarks already, where it's running at 60% now, and Q3, it will be fully, maximum utilization will come. All the individual units also have been in detail mentioned already. We would like to also add that the MS production also started. LPG, though it's not a normal product after the petchem unit comes. Right now, we have started shipping out LPG also. With this, all the fuel products which have been targeted are already under production. Gradually it will stabilize. The key challenge here for an inland refinery is any of the intermediate product gets surplus, will not be able to move out postally. We are overcoming that by matching all the units at the right capacities and at the right times. Nikhil, just one overarching comment. We have been talking HRRL at least five or six times I've done in this call. I'm personally very confident on the team. It's going to get it done. Remarkable job by our team, and this refinery will work. Very confident about. There will be challenges, it always comes when you start a new asset. We are quite confident that we have the line of sight to the full run on this refinery. Petchem, we do have a bit more work to do. Till that time, we will sell LPG and other products. Thank you, sir. That's very helpful context. Just another quick question I had. You mentioned about that under the stress scenarios, the SPR also becomes available to all the refiners. How does that mechanism work? Is it more like you can borrow that crude from the reserves, and you repay it back by crude oil at a later point of time, and you pay an associated usage fee or a lease fee, or does that work on some sort of a different mechanism? Just curious. Thank you. I think there are two, three different parts of SPR. Actually, some part of caverns which are next to SPR. HPCL owns directly some part of the caverns. We also own in Vizag a cavern ourselves. SPR, we did take crude from there, and so did others. I think the crude, there is a permission, you actually have to go to ISPRL board to do that, and you put in a requisition, they do that. It's at, I think, at the market prices, and then there is some sort of agreed fee, et cetera, which is there. That's one. The filling is done by government. When we bought out crude from there, we got it out at market prices. There is a part of SPR which, if I'm not mistaken, is one of the international oil majors stores its own crude. That might work slightly differently. I'm not fully conversant with those details. We did buy crude. Given that what we were buying from there was, I think, cavern in Vizag had Basrah, if I'm not mistaken. You couldn't even replace Basrah because nothing was coming out of it. It was given at the market price and some fee, et cetera. ISPRL is good set up for doing that, and they are very quick on it. There were times when we needed something urgently, very quickly we got those. I think BPCL and other also took it. Understood. Thank you so much. All the very best. Thank you, Nikhil. The next question comes from the line of Vikash Jain with CLSA. Please go ahead. Thanks for taking my question. Just a few of them. Firstly, I must apologize to divert discussion away from the very exciting changes that you're trying to bring. This is more mundane, regular quarter-to-quarter stuff, sorry to disappoint on that. Just if I were to look at the way crude price has moved from the end of the quarter to now, it's about a $20 move. If we look at that and the fact that last quarter the CapEx that you would have spent would possibly be on the lower end of your typical quarterly run rate, given the annual guidance. Would it be fair to say that the current debt would be much higher than where it was at the end of the quarter? Current debt would roughly be similar. Give or take INR 1,000, INR 2,000 here and there. It's roughly similar. Just to give you some broad sense on the debt, I think we were looking at this being, again, very difficult to predict the future, if today's situation holds, I think we are at the top of the mountain. I don't know whether it's a peak going down or a plateau, it's roughly similar at the end of the quarter. Okay. Could you also comment a bit about ATF losses? How much do you estimate that to be for the last quarter? There was a mechanism suggested, not all airlines took that mechanism. How is that working out? A good thing, Vikash, on that one is, there are two others who have bigger problem to solve on ATF than I have. When this problem comes to my desk, I said, "Okay, I have other problems to solve." I don't know, Shiv, if you have any thoughts on that. I'll see if my team has. Otherwise, if they don't have the details, we can give them to you offline. I'll be personally honest, I've applied myself less on ATF, considering our market share is not the largest on this one. Thank you. Vinod will help address that separately with you. Thank you. The next question comes from the line of Keshav Soni with Kotak Bank. Please go ahead. Hi, sir. Thanks for taking my question. I just wanted to get the number on refinery-wide GRM. I'm sorry to interrupt, Keshav. I would request you to be a little louder. Yeah. I just wanted to get the refinery-wide GRM across all three refineries and some performance update of 15. I think on GRMs, we have been very consistently giving what we have given out, and we'll stick to that level of disclosure. We've been very consistent with it. Does that answer your question, Keshav? Yeah, sure. Thanks. The next question comes from the line of Abhishek Maheshwari with Skyridge Fund Managers LLP. Please go ahead. Yeah. Thank you. Thank you for taking my question, and congratulations for HRRL commercialization. Sir, only one question remains. Regarding accounting of HRRL, will we show it as JV only, for instance, with share in profit and loss of JV, or will it be consolidated in the financial statements? It will be a JV accounting. It will be a share of profit. Okay, sir. Thank you. That's it. Thank you. Ladies and gentlemen, we will take that as the last question for today. I would now like to hand the conference over to Mr. Varatharajan for the closing remarks. Thank you, everyone. Sir, if you have any closing remarks, Mr. Kaushal, please. No, I think we've said enough. I'll only say if anybody has follow-up questions, our team is always available. If anybody wants to meet us, we are more than happy to look at it. As you guys write your comments, do share with us. We'll also learn from whichever way you are looking at it. I've always said you all look at it from different perspectives. It's always interesting to look at what you have to say. We look forward to all the comments there. Thank you for patiently listening to the thing, a lot of good and interesting discussion. I'll just sum it by saying it's been a tough time for this industry, but at the same time, tough time make people stronger, teams stronger, and ours is a very strong team. As I said, we are hungry, we are mean, we are keen to perform strongly. Hopefully things will be better when we meet next time, three months from now. Thank you all. Thank you, sir. Thank you, sir. Thanks, everyone, for participating in the call and for HPCL to continuously giving us this opportunity to host them. Thanks, everyone. Have a nice day. Thank you. Thank you, sir. Ladies and gentlemen, on behalf of Antique Stock Broking, that concludes this conference call. Thank you for joining us and you may now disconnect your lines.