The Covid-19 demand suppression in early part of the year is likely to abate for oil marketing companies, now with state-run companies—IOC, HPCL and BPCL making a strong beginning to FY21 returning high levels of earnings per share between 37 and 266 per cent in three months, ICICI Securities has said in a report.

The report on refining and marketing has said that the companies’ shares would be flying on stock exchanges on the back of record auto fuel marketing margin, inventory gain and in case of BPCL and HPCL, surge in GRM (gross refining margin) on a low base.

Net auto fuel marketing margin (on sale of petrol and diesel) is estimated at Rs 6.1 per litre in Q1FY21 and Rs 2 per litre in Q2FY21. The higher margin is on account of upwards revision of fuel prices that started on June 7 and continued for 22 continuous days raising petrol and diesel prices by about Rs 9.17 and 11.39 per litre respectively.