Stocks of state-owned oil marketing companies are likely to remain subdued next week as the focus shifts to companies announcing earnings for the quarter ended September. Shares of Cairn India, which will detail Jul-Sep earnings on Monday, are expected to remain firm next week with the company likely to report robust growth in sales and profit.
Cairn India's consolidated net profit for Jul-Sep is likely to see a near four-fold rise year-on-year to 28.02 bln rupees, on the back of higher production and improved realisations due to sharp depreciation in the rupee.
All the three retailers Indian Oil Corp, Bharat Petroleum Corp, and Hindustan Petroleum Corp--will report their Jul-Sep numbers in November. Their shares will take cues from the movement in crude prices and rupee-dollar exchange rate. The Indian currency fell sharply this week to 53.84 a dollar from 52.80 last week. Continued weakness in the rupee may lead to decline in the shares of the three state-owned oil companies, as it makes their crude imports costlier.
The companies import over 75% of their crude oil requirements. India's crude oil basket softened slightly this week, but it continues to hover over an uncomfortable $111-a-barrel level. Reliance Industries reported gross refining margin of $9.5 a barrel in Jul-Sep, up from $7.6 in the previous quarter.
