GULFOILLUBNSENovember 12, 2025

Gulf Oil Lubricants India Limited

6,953words
79turns
10analyst exchanges
3executives
Management on call
Ravi Chawla
MANAGING DIRECTOR AND
Manish Gangwal
CHIEF FINANCIAL OFFICER
Probal Sen
ICICI SECURITIES
Key numbers — 40 extracted
3x
mpact and demand is lower. We have continued our growth trajectory of growing our volumes by 2 to 3x times the market and have a better sale of Lubricants of 40,500 KL, which gives us a 9.5% growth.
9.5%
s by 2 to 3x times the market and have a better sale of Lubricants of 40,500 KL, which gives us a 9.5% growth. This obviously, with the first quarter being also a double-digit growth, we are ending H1
3%
hich is a good sign. I think all the initiatives that we have taken, and we are seeing the normal 3% growth in the market. It's been a resilient performance. Of course, monsoons in April and May, a
24%
oo had double- digit growth. AdBlue volume in this quarter grew well at 36,000 KL, which is around 24% growth. We have seen that if you take this in H1 terms, we have seen AdBlue at about a 10%
10%
around 24% growth. We have seen that if you take this in H1 terms, we have seen AdBlue at about a 10% growth and lubes too at 10% growth. Revenue, again, for us has been a
12.6%
r, but overall an excellent growth this quarter with mix improving in terms of revenue. We've had 12.6% revenue growth compared to last year for H1. Our EBITDA also grew this quarter by 10.56% and this
10.56%
We've had 12.6% revenue growth compared to last year for H1. Our EBITDA also grew this quarter by 10.56% and this helped in double-digit growth for the H1. Overall, I think a very good quarter. As we
Rs. 42
r portfolio here. I am very happy to share that our EV charger subsidiary, Tirex, closed in H1 at Rs. 42 Cr against Rs. 24 Cr last year, which is 75% growth. The second half will be even better for this
Rs. 24
I am very happy to share that our EV charger subsidiary, Tirex, closed in H1 at Rs. 42 Cr against Rs. 24 Cr last year, which is 75% growth. The second half will be even better for this segment as more of
75%
our EV charger subsidiary, Tirex, closed in H1 at Rs. 42 Cr against Rs. 24 Cr last year, which is 75% growth. The second half will be even better for this segment as more of the deployment of charger
3.5%
profitability is also because the rupee depreciated sharply during the quarter. As we all know, a 3.5% movement in rupee during one quarter is not a very usual thing. It's a very unusual
Rs. 85.76
movement that resulted in the landed cost of our imported products going up from Rs. 85.76 towards June and the rupee closed at 88.79 and nearly 88.8 at the end of September. That had impac
Advertisement
Guidance — 20 items
Probal Sen
opening
“The format will be like calls earlier as well.”
Ravi Chawla
opening
“We expect this momentum to continue in the agri sector when the season is there.”
Ravi Chawla
opening
“The second half will be even better for this segment as more of the deployment of chargers happen.”
Manish Gangwal
opening
“But overall, we see that operationally, very strong quarter, and we believe that rupee, if it stabilizes at the current levels and if crude remains at the levels of $ 65-70, which it has been hovering for the last many months, then the trajectory going forward should be better.”
Manish Gangwal
opening
“We are also happy to share that the Board has approved additional 14% stake to be increased in Tirex, our DC charger subsidiary, which Ravi spoke about, which shows that our overall strategy, our Board's direction of having Tirex as a growth potential and strategic value going forward is very clear and we will invest Rs.”
Varun
qa
“Firstly, what would be the overall EBITDA margin target for the full year?”
Manish Gangwal
qa
“Margin-wise, we always keep guiding that our EBITDA margin will be in a band of 12% to 14%.”
Manish Gangwal
qa
“As I mentioned in opening remarks, that if rupee stabilizes at the current levels, and we are seeing some downward trend in base oil already happening as we speak, so going forward, margin should improve only from here on.”
Manish Gangwal
qa
“That also are a long-term to medium-term strategy of improving the margins.”
Varun
qa
“Was there any additional Ad spend or your Ad spend remain in line with the 4% target which you have given?”
Risks & concerns — 4 flagged
Overall, a very strong quarter on operational side with a little headwind of rupee.
— Manish Gangwal
We had earlier put an estimate that out of the total -- if all the new data centers turn into liquid cooling, which is for the air cooling, you will find it's an extremely difficult sort of thing that will happen because it requires a complete change in terms of the technology for cooling.
— Ravi Chawla
Firstly, you mentioned, I think, a couple of quarters back that OEM was the segment where there was a slowdown due to which your volumes were also like getting affected.
— Sabri
Are we like done with the OEM slowdown or it is still the same?
— Sabri
Advertisement
Q&A — 10 exchanges
Q
A couple of questions from my side. Firstly, what would be the overall EBITDA margin target for the full year? This year due to forex and all, our EBITDA margin for first half has been around 12.3%. So, do you still guide that it can inch up to 13% by the end of the year? Secondly, on the cash flows, the cash flow generation from operation has been poor this half. What has majorly led to the same as compared to Rs. 131 Cr, we have only done Rs. 24 Cr of cash from operations. I see the trade payable days also going down. Has that impacted? Or if you can give a brief explanation on the same?
Manish Gangwal
Yes. Margin-wise, we always keep guiding that our EBITDA margin will be in a band of 12% to 14%. In good quarters, obviously, we are towards the higher trajectory of this band. In slightly subdued quarters where we have some headwinds, we tend to be towards the lower end. But the band remains still intact. As I mentioned in opening remarks, that if rupee stabilizes at the current levels, and we are seeing some downward trend in base oil already happening as we speak, so going forward, margin should improve only from here on. But at this stage, it also depends on crude movement and the forex vo
Q
Sir, pardon me for asking this very basic question. On the consumer side, when we go to a mechanic for servicing our vehicle, and we have many choices and the mechanic pushes for a specific brand or a product versus competitor brand. How are we like pushing the product in that sense, is it the sole choice of mechanic? Or is it something else? Like what is the strategy that side?
Ravi Chawla
No. Lubricants is very mid involvement to low involvement, sometimes high involvement product. So based on the category, if you take, say, motorcycle and car, there is obviously the consumer will have some say. In some cases, consumers also decide, but the mechanic plays a role as an influencer. Sometimes he's like a quasi consumer. It just depends on the various consumers. What we obviously have to make sure is that the consumer is seeing us in the awareness set. He understands our product, whatever communication, our quality. We have various other attributes like long drain and other things.
Q
I hope I'm audible. Sir, actually, my question was related to our sales in this quarter. Can you please provide us the breakup of sales and growth in respective segments? That would be the first part. Secondly, we had some GST reforms which rolled in particularly, like, it was also rolled in for like vehicles as such, I mean, where GST was reduced. Do you expect, like in medium to long-term, this would lead to improved sales in vehicles and therefore, like improved sales in lubricants as well? Or are you seeing any early green shoots of OEM demand picking up for our lubricants from OEM manufac
Ravi Chawla
Yes. Nitin, I have covered this. Our overall volumes grew by 9.5% this quarter. I am very happy to share that most of our key segments like passenger car motor oils, motorcycle oils, if you take even OEM segment with franchisee workshop, agriculture and some of the B2B segments, which are part of our growth, all these segments have grown double digit. So, they are above double digits, so healthy growth. In fact, AdBlue also grew 24% in this quarter. These are the segments we have done. The others are single-digit, which are not mentioned. That's the way the growth has happened. As you saw in t
Q
Congratulations on a good set of operating numbers. I've got 3 questions. Firstly, you mentioned, I think, a couple of quarters back that OEM was the segment where there was a slowdown due to which your volumes were also like getting affected. Since the last 2 quarters, you've been growing at like close to 10% sort of run rate. Are we like done with the OEM slowdown or it is still the same?
Ravi Chawla
No. OEM factory fill was down, which we had mentioned. Yes, factory fill. I meant, factory fill. Yes. To factory fill, which is the first fill happening, we do for commercial vehicles and some other OEMs. That was a bit slow last year, you're right. Now even that is okay, it's picking up because we mentioned on also GST cuts, commercial vehicle and all that. What we spoke about this quarter was the OEM franchisee business, which actually was doing well, but I think now we are seeing double-digit growth there, which is also by the agri OEMs, we do business with agri OEMs, we do with car, we do
Q
My first question is about the competitive landscape, sir. Our biggest private sector competitor, they came out with the results as well. And from the sense that, I got was they're looking to grow again, in terms of volume, in terms of market share? What I also saw was technology-wise, they came up with the latest API SQ upgrade for their lubricants, their flagship lubricants. So, API SQ is already on the market, I think, with them. So, update on the competitive landscape with respect to the No. 1 and technology-wise, is it something API SQ, is it something that we can differentiate with?
Ravi Chawla
Most of the specifications are available. Obviously, we all have availability to that through the additive company. We have also launched our motorcycle oil at API SP. That is also available for us to launch. We have a global portfolio. Yes, I think that way, we have been doing it for the last 15-20 years to increase our market share, and we differentiate on many parameters, brand, product, our go-to-market strategies, our other things. I think it is a competitive market. Definitely, this is what we are also focused on and we have been growing, as you know, for the last 17-18 years at 2-3x the
Q
My first question is I understand 50% is the norm, but will hedging higher percentage against the FX exposure help the company with the EBITDA margins? That's number A. Basically, going forward, do you plan to hedge more? The second question is regarding some news over Bloomberg, wherein Hinduja Group particularly is interacting with Andhra Pradesh government in terms of renewable energy as well as electric mobility. Given Gulf has improved or increased its stake in Tirex, is Gulf Oil going to benefit out of this or if you can shed some light on this? These are 2 questions I have.
Manish Gangwal
First one, on the forex hedging, we have a well-defined Board-approved policy, and we take guidance of not only our bankers, we have 2 experts, forex experts, advisers in our panel who keep guiding us on the percentage of hedging. We have been hedging more than that. In fact, depending on the advice, we keep hedging anywhere between 50%-75%. At some point, we have done even 90%. That would depend on the advisers and the way these experts advise us how they feel the rupee will track.. We follow that guidance. On the second question, we are not clear exactly what you're trying to say. Can you re
Q
Sir, if you can just throw some light on the question asked by the earlier participant. In terms of we have cash and bank balance to the tune of over Rs 1,100 Cr, investment somewhere closer to Rs 100 Cr on one hand. On the other side, we have a borrowing in foreign exchange about Rs. 470 Cr? I didn't understand the point that you are giving this loan and this loan comes back as on 30th September and as on 31st March on that balance sheet date and that's in the current account. Can you just throw some light on this loan giving thing, the interest earning and what is the rate of interest that y
Manish Gangwal
I think we have already replied to this query earlier. We just want to repeat that there is a war chest which is being developed. That war chest is for looking at company's future. We at the same time, while looking at the cash flow generation of the company, the Board has increased the dividend payout significantly in the last 3 years from nearly 35% payout, the last year's payout was, I think, around 60%. While returning cash to shareholders, some cash is being kept at the war chest to keep looking at the opportunities. The buyer credit is more of a treasury management because we do a lot of
Q
I have a couple of questions. You mentioned 9% volume growth this quarter, right? What is your outlook for FY '26 in terms of volume as well as profitability both? Do you see this figure improving and entering early teens as we move into H2? Also, what's the kind of indication coming from the OEM partner in Q3?
Ravi Chawla
Yes. I think that is a sort of a regular practice which we have with OEMs. We'll come to that later. But as we've been advising the growth, of course, in quarter 2 has been 9.5% and H1 has been 10%, which is a very good growth because industry is growing at 3%. We maintain that whatever is the industry growth today, it would be at about 3% to 4%. We will continue growing 2 to 3x. In some segments, obviously, we have low market share, we try to grow, and that's how the overall growth comes to 2 to 3x. And that is the continued outlook for us that the minimum slab would be to grow at 2x and 3x a
Q
We would request if we just could make the closing remarks, if possible.
Management
Q
Yes. Thank you. Thank you, everyone, for your time. Thank you to the management for taking the time to answer all the questions in detail. We have some prior engagements, so we are having to close the call right now. Thank you, everyone. You may disconnect. Thanks.
Ravi Chawla
No, we'd like to just summarize the outlook so that we can end with that. My apologies, sir. Over to you. Yes. I think with the last question, we ourselves spoke to you about the outlook. We're really seen good growth coming in H2. Monsoon quarter was slightly subdued as it normally is. The Indian automotive industry in the second half is certainly looking at things with renewed share, supported by the strong festive season, the marriage season coming up, stable in macroeconomic conditions. Of course, the GST reform that has come in is really going to help to improve overall affordability, and
Speaking time
Ravi Chawla
18
Manish Gangwal
17
Moderator
12
Sabri
8
Saurabh Sharma
6
Nitin Tiwari
4
Probal Sen
3
Varun
3
Achal Shah
2
Dhaval Popat
2
Advertisement
Opening remarks
Probal Sen
Thank you, everyone, for making the time to attend this post second quarter FY '26 earnings call of Gulf Oil Lubricants India Limited. We have with us members of the senior management represented by Mr. Ravi Chawla, Managing Director and CEO of the Company; as well as Mr. Manish Gangwal, the Chief Financial Officer of the Company. The format will be like calls earlier as well. We will invite the management to make their opening briefing on the results and then get into an interactive Q&A session. So over to you, sir, for the opening briefing.
Ravi Chawla
Thank you, Mr. Sen. Good day, and welcome all of you to Q2 & H1 FY26 Earnings Concall of Gulf Oil Lubricants India Limited. I am happy to share that as we had performed well in Q1, which is a very good quarter, as well as in the second quarter, which is usually a monsoon quarter and has a little bit uneven monsoons having an impact and demand is lower. We have continued our growth trajectory of growing our volumes by 2 to 3x times the market and have a better sale of Lubricants of 40,500 KL, which gives us a 9.5% growth. This obviously, with the first quarter being also a double-digit growth, we are ending H1 at a double-digit growth in volume, which is a good sign. I think all the initiatives that we have taken, and we are seeing the normal 3% growth in the market. It's been a resilient performance. Of course, monsoons in April and May, a little bit uneven, but September, we saw good demand picking up, and we've continued to do that. B2C segment for us, which is a very important segme
Manish Gangwal
Thanks, Ravi. As Ravi mentioned, operationally, a very strong quarter with a robust volume growth, 2 to 3x and double-digit revenue growth. The slight impact which we are seeing in the profitability is also because the rupee depreciated sharply during the quarter. As we all know, a 3.5% movement in rupee during one quarter is not a very usual thing. It's a very unusual movement that resulted in the landed cost of our imported products going up from Rs. 85.76 towards June and the rupee closed at 88.79 and nearly 88.8 at the end of September. That had impact on our gross margins, but we are happy to share that we have still been able to manage our gross margins almost in the same range and took selective pricing calls. Overall segment mix, product mix helped us to deliver a gross margin, which was similar to earlier quarters. What we are also seeing is that, on our open positions of forex, we had a mark-to-market loss because the rupee depreciated sharply towards the end of September as
Advertisement
← All transcriptsGULFOILLUB stock page →