Castrol India: Slipping badly

Castrol India slipped badly in the June quarter — its revenue fell 10 per cent and profit declined a sharper 33 per cent y-o-y. The company’s performance was impacted by lower volumes due to the impact of GST transition and the lingering effect of demonetisation. The commercial vehicles oil business, in particular, was badly hit. Also, a sudden rise in the price of base oil, the main raw material, did not help.

Castrol India’s weak performance was in contrast to the decent show put up by Gulf Oil Lubricants thatmanaged volume growth and 13 per cent y-o-y growth in profit in the June quarter. Castrol India’s performance has been lagging that of Gulf Oil Lubricants for several quarters now. Consequently, the latter’s stock has done much better. Historically, the stock of Castrol India, as the market leader, commanded a valuation premium and Gulf Oil Lubricants played catch-up. Now, the latter trades at a slight premium.

c:set var="prUrl" value="https://premium.thehindubusinessline.com" />

Read further by subscribing to

The Hindu Businessline

What You'll Get

  • Web + Mobile

    Access exclusive content of the Hindu Businessline across desktops, tablet and mobile device.


  • Exclusive portfolio stories and investment advice

    Gain exclusive market insights from the Hindu Businessline's research desk.


  • Ad free experience

    Experience cleaner site with zero ads and faster load times.


  • Personalised dashboard

    Customize your preference and get a personalized recommendation of stories based on your intrest.

Related

This article is closed for comments.
Please Email the Editor