Indian Oil Corporation (IOCL IN) – Q2FY26 Result Update – GRM Improves, EBITDA and PAT beat cons – Accumulate
Published on 28 Oct 2025
Indian Oil Corporation (IOCL) reported refining throughput of 17.6mmt with reported/core GRM of USD10.7/8.9/bbl, led by improvement in product cracks, especially HSD spreads. Inventory gain stood at USD1.8/bbl vs a loss of USD4.8/bbl QoQ. Domestic marketing sales volume stood at 20.19mmt, up 3.4% YoY. Implied gross marketing margin (GMM) stood at Rs7.1/lit vs Rs8.7/5.5 in Q1FY26/Q2FY25. Reported standalone EBITDA was above cons at Rs145.8bn (Ple Rs117.9bn, BBGe Rs133.9bn, Q1FY26/Q2FY25 – Rs126.1/37.7bn), while in H1FY26 it stood at Rs271.9bn vs Rs124.1bn in H1FY25. Standalone PAT came in at Rs76.1bn (Ple Rs52.6bn, BBGe Rs59.4bn) vs. Rs56.9bn/1.8bn in Q1FY26/Q2FY25, leading to a PAT of Rs133.0bn in H1FY26 vs Rs28.2bn in H1FY25. Petrochem EBIT stood at Rs1.6bn, vs a loss of Rs. -10mn in Q1FY26. Co. will receive LPG under-recoveries compensation for LPG sales of Rs144.9bn in 12 monthly instalments from Nov’25 onwards. We build in a GRM of USD7.2/6.0/bbl and a blended GMM of Rs4.9/4.4/lit for FY27/28E. Due to continued momentum in products cracks and expected compensation of LPG under-recoveries, we reiterate our ‘Accumulate’ rating on the stock with a TP of Rs166 based on 1.0x FY27/FY28E P/BV.
