Karachi, February 06, 2023 (PPI-OT): Pakistan OMCs: POL sales down by 20%YoY in Jan’23

POL product sales clocked in at 1.44mn tons for Jan’23, changing by +8%/-20% on MoM/YoY basis, compared to 1.34/1.8mn tons during Dec’22/ Jan’22.

This marks the second consecutive month with petroleum sales below 1.5mn tons. Although, there is a slight recovery on a monthly basis (up 8% MoM) due to rumours of a potential price hike, which may have prompted some hoarding.

Company wise, major players in the sector, PSO/APL/SHEL/ GOPL, delivered throughput levels of 704k/140k/115k/85k tons, taking total market share to stand at 49%/9.7%/8.0%/5.9% for Jan’23, respectively.

APL’s offtakes witnessed the strongest recovery on a MoM basis (up 16% vs. industry’s 8% during Jan’23) majorly due to a big spike in RFO offtakes, up 84%MoM. This may be due to increased offtakes from the power plants the company sells to in Punjab (Attock-Gen, NPL, NCPL etc.), as depicted by recent upticks in RFO based generation during Dec’23 (up 267%MoM), amidst recent RLNG scarcity in the country.

Overall, APL (TP: PkR370/sh) is our top pick from the sector, with the company being a perfect mix of capital upside and dividend yield.