HPCL shares are a buy, hold or sell? Analysts share views on each point

Shares of Hindustan Petroleum Corporation Ltd. (HPCL) are set to react to their December quarter results on Thursday, December 22. The results were reported after market hours on Wednesday.

HPCL's results were a miss on expectations due to the underperformance of its refining segment. This is despite the commissioning of its new Vizag refinery. Although its topline was higher than expectations, its Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA), margins and net profit were lower than what the street had anticipated.

Additionally, its Gross Refining Margins (GRMs) at $8.9 per barrel, also turned out to be lower than the estimates of $10 per barrel.

Despite the weak results, two-thirds of the 34 analysts who have coverage on HPCL have retained their "buy" rating on the stock. Four others have a "hold" rating, while seven others have a "sell" recommendation on the state-run refiner.

Here are views on all three recommendations:

Buy

Citi has a "buy" rating on HPCL with a price target of ₹595. The price target implies an upside potential of 38% from current levels.

The brokerage stated that HPCL's largely stable refining margins & lower marketing margins were offset by a contraction in LPG losses, partial recognition of previously-announced LPG compensation, and lower forex losses.

HPCL said that the stock is currently trading at 6 times its financial year 2026 annualized price-to-earnings and at 1.6 times price-to-book, with its nine-month EPS of ₹58 and Book Value per Share of ₹258 per share.

Hold

CLSA has a "hold" rating on HPCL with a price target of ₹420, which is almost the same price at which the stock closed on Wednesday.

HPCL's stronger‑than‑expected refining margins were more than offset by a sharp miss in unit marketing margins, despite volume being in line, CLSA's note said.

Sell

Jefferies has a "sell" rating on the stock with a price target of ₹385, implying a potential downside of 11% from current levels.

HPCL's EBITDA was 11% lower than Jefferies' estimates due to the refining segment's underperformance.

However, it highlighted two positives. One, government's compensation for LPG losses will boost earnings over financial year 2026-2027, and two, low crude price outlook for 2026 is constructive for marketing margins.

On the flip side, Rajasthan refinery will commission by financial year 2027 and that could be a drag on its profitability. Jefferies finds valuations to be full and at a premium to BPCL and as a result, a combination of this and the earnings miss prompted the brokerage to cut its financial year 2026 profit estimate by 3%.

Shares of HPCL are currently little changed in early trading on Thursday at ₹429.7. The stock is up 16% in the last 12 months.