New Delhi: Hindustan Petroleum Corporation Ltd (HPCL) is the most vulnerable of India's major oil marketing companies (OMCs) if crude oil stays above USD 100 per barrel, Equirus Securities said in a statement issued on Friday. Sustained prices at that level could put pressure on all OMCs, particularly if petrol, diesel and Liquefied Petroleum Gas (LPG) prices stay unchanged, according to Maulik Patel, Head of Research at Equirus Securities.
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"If crude remains above US$100 per barrel, with restricted retail-price increases, OMCs could face negative petrol and diesel marketing margins, higher LPG under-recoveries, higher crude-landing, freight and insurance costs, working-capital and debt accumulation and inventory losses if crude subsequently corrects sharply," Patel said.
How far that pressure goes would depend mainly on retail-price pass-through, government policies and refining cracks, he said.
HPCL's refining-to-marketing ratio is 51 percent, against 74 percent for Bharat Petroleum Corporation Ltd (BPCL) and 80 percent for Indian Oil Corporation Ltd (IOCL), according to Equirus. As a result, HPCL has the lowest internal refining cover of the three. It is also the most dependent on purchased and imported products.
HPCL's distillate yield is also lower, at 76 percent, compared with 80 percent for IOCL and 85 percent for BPCL. That limits its ability to fully benefit from strong diesel and jet fuel cracks, the firm said. The effect also carries through to HPCL's balance sheet, where its leverage is the highest.
IOCL ranks second, since its stronger integration gives it a refining buffer. Its absolute exposure is still substantial, however, according to Equirus. That exposure spans fuel marketing, LPG under-recoveries, inventory, working capital and expensive crude procurement. IOCL also carries petrochemical losses.
BPCL is relatively better placed. Equirus put this down to its better integration and the highest distillate yield of the three. It also cited crude flexibility at the Bina refinery and a comparatively stronger balance sheet.
Equirus named BPCL its preferred OMC as a contrarian call on a correction in crude prices. The firm said BPCL's better refining-to-marketing ratio and higher distillate yield give it a stronger integrated earnings buffer than HPCL. The stock trades at a trailing price-to-book multiple of 1.3x, which Equirus described as a cyclical low. It could see a meaningful rerating if crude prices correct sharply, the firm said.
For Oil and Natural Gas Corporation (ONGC) and Oil India Ltd, the effect runs the other way. "ONGC and Oil India are most direct beneficiaries of higher crude realisations which has not been reflected in valuations yet," Patel said.
Equirus described Reliance Industries Ltd as a balanced oil-linked exposure. Its complex oil-to-chemicals (O2C) system benefits from strong product cracks, a diversified crude basket and feedstock flexibility, the firm said. Jio and Retail add further earnings diversification. The catalysts Equirus listed are a sustained O2C recovery, growth in Jio's average revenue per user and margins, normalisation of Retail margins and execution in New Energy.
City Gas Distributors (CGDs) face near-term margin risk from rising spot Liquefied Natural Gas (LNG) prices and crude-linked LNG contracts, according to Equirus. Their volumes remain relatively resilient, however. CGD sector consumption rose to 55.2 million standard cubic metres per day (MMSCMD) so far in 2026-27, from 45.3 MMSCMD in 2025-26. The imported share of that gas has also risen sharply.
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Within the sector, Gujarat Gas is exposed to higher Brent-linked spot LNG prices and rupee depreciation. Gas-trading profits partly offset that exposure. Mahanagar Gas Ltd is better cushioned through Henry Hub-linked sourcing and pricing action, Equirus said, although its margins remain volatile in the near term.
Petronet LNG is more exposed to LNG affordability and regasification volumes. Qatar normalisation, tariff visibility and petrochemical capital expenditure remain the key watchpoints for the company, according to Equirus. GAIL (India) Ltd is relatively defensive because its transmission earnings provide a buffer. Its petrochemical and gas-marketing profitability is also improving on higher realisations, the firm said.
Outside the oil and gas sector, Equirus's broad vulnerability ranking puts aviation first, followed by tyres, paints and adhesives.
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