- OGRA has proposed revising the margins for Oil Marketing Companies (OMCs) and dealers.
- The proposals were submitted after PSO provided operating cost data to review and calculate margins.
- The OMC margins on MS and HSD are proposed to be increased to PKR 9.22/ltr from the current PKR 7.87/ltr.
- Meanwhile, the dealer margins on MS and HSD are proposed to increase from PKR 1.40/ltr to PKR 10.04/ltr.
- The federal government will make the final decision on this matter, and if approved, the increase will be implemented in phases.
- Our analysis suggests that the margin revision will have an annualized earnings impact of PKR 11.63/share, PKR 8.36/share, and PKR 4.39/share on PSO, APL, and SHEL, respectively.
- During 1QFY24, MS sales remained stable at 1.85mn tons, while HSD dispatches decreased by 1% YoY.
