OMCs: Upturn continues with 21% YoY growth

September 2, 2020 (MLN): The overall volumetric sales of Oil and Marketing Companies (OMCs) in Pakistan declined by 7% MoM in August 2020 to stand at 1.55 MTs against 1.66 MTs in July 2020.

On yearly basis, the total industry sales improved by 21% YoY when compared to 1.28 MTs in August 2019.

According to the report by Aba Ali Habib Securities, on monthly basis, fuel demand contracted due to heavy monsoon rains which hampered movement of goods nationwide. Port city remained flooded in most part of the month denting domestic demand of MS.

On sequential basis demand of motor fuel declined 3% MoM, while the HSD demand contracted 25% which is key fuel for transportation/ freight. On the other hand, sales volumes of furnace oil jumped 31%MoM due to competitive power generation cost and looming gas shortage.

Category-wise, demand of motor fuel (MO) improved 10% YoY and declined by 3% MoM to 0.697 MTs, while the HSD which is key fuel for transportation/freight, its demand increased by 25% YoY and dropped by 25% MoM to 0.508 MTs.

On the other hand, sales volumes of furnace oil saw a significant rise of 71% YoY and 31% MoM to stand at 0.31 MTs.

On a cumulative basis, the overall sale of OMCs during 2MFY21 were recorded at 3.2 MTs as compared to 2.82 MTs in the corresponding period of last year, showing a growth of 14% YoY on account of low petroleum prices along with resumption of economic activity.  FO sales during 2MFY20 saw a rise of 15% YoY, while sales of HSD and MS also jumped by 24% and 12% YoY respectively.

Company wise, PSO posted the highest growth of 26% YoY in August’20 among peers due to increase in sales of FO by more than 100% as compared to last year.

APL sales volume declined by 10% YoY along with SHEL & BYCO sales volume who also saw a decline of 8% YoY. On the flipside, HASCOL posted an increase of sales by 20% YoY mainly due to jump in MS sales by 35% YoY.

On monthly basis, PSO posted the largest volumetric decline of 7% MoM in sales of petroleum products, contributed by weak sales of HSD (down by 28%MoM), MS (down by 9% MoM) while FO sales jumped by 63% MoM. Consistent with the trend, BYCO, APL, HASCOL and SHELL volumes plunged by 1%, 23%, 16% and 9% MoM respectively.

On the market share front, PSO grasped the largest market share of 48.5% in August’20 against 46.4 % in the same month last year mainly due to uptick in FO sales. On the other hand, the other OMCs (APL, Shell, BYCO) market shares declined during the month, while HASCOL’s share remained largely unchanged at 4.8%.

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