June 3, 2021 (MLN): The overall sales of Oil and Marketing Companies (OMCs) in May 2021 witnessed a marginal increase of 1% MoM to 1.69 MTs on the back of long Eid holidays and lockdown restrictions amid the third wave of COVID-19.
The humble growth on MoM basis may be attributed to a 9% increase in MOGAS sales whereas HSD sales posted a decline of 3% as the wheat harvesting season ended in Apr’21. However, HSD sales are likely to rebound in the coming months amid the sowing of rice crops.
During May’21, MOGAS sales reached an all-time high of 731KT. This notable increase in MOGAS sales is primarily attributable to healthy economic activities, and not due to any dealer discounts.
The YoY growth in sales of OMCs is driven by HSD and MOGAS demand which recorded a growth of 11% and 15% YoY to 0.76 MTs and 0.73 MTs respectively. This notable increase in MOGAS sales is subject to pick up in overall economic activity after improvement in the Covid-19 situation.
Cumulatively, during 11MFY21, the overall sales of petroleum products increased by 18% YoY to 17.52 MTs on the back of high fuel demand from the power sector, upsurge in auto sales and recovery in industrial activities followed by higher LSM numbers.
According to a report by Ismail Iqbal Securities, strong sales are likely to continue, as indicated by auto sales numbers released by PAMA, where 10MFY21 car sales increased by 54%, while two-wheelers sales increased by 34% YoY. In addition to this, due to increased reliance on RFO based electricity generation, RFO sales have grown by 16% YoY in May-21.
Company-wise, SHEL led the volumetric growth chart by posting 35% YoY on the back of strong sales of HSD (up by 59% YoY in May 21). During the month, PSO witnessed a growth of 22% YoY. Among other listed companies APL and BYCO managed to post-minimal growth of 3% YoY in May’21, a report by Arif Habib Limited highlighted.
However, HASCOL posted a decline of 50% YoY due to a decline in MOGAS and HSD sales by 42% YoY and 55% YoY, respectively
In 11MFY21, the overall market share of PSO has improved to 46% against 43% in the same period last year. This was primarily driven by improvement in HSD market share which improved to 48% compared to 45% during the same period last year. While APL, SHEL and HASCOL witnessed drops in market share which declined to 8.8%, 7.9% and 4.1%, respectively.
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