The sales of the Oil Marketing Companies (OMCs) showed a successful month with a 14 percent year-over-year increase, reaching an all-time high of 1,692-kilo tons. The increase in sales came despite the week-long holidays due to Eid.
The hike is being attributed to the resumption of economic activities where HSD grew by 11 percent and MOGAS grew by 15 percent in May 2021, according to an analyst report by Ismail Iqbal Securities.
Another brokerage house, Topline Securities, said that this increase is also pronounced due to a lower baseline from last year when the lockdown reduced economic activity and led to fewer working hours. However, there has been a notable recovery in economic activity, coupled with harvest season and improved car sales and energy generation, which all contributed to increased sales of petroleum products.
On a monthly comparison, HSD grew by 3 percent, while Furnace Oil (FO) posted a decline of 5 percent, Topline Securities report said.
Strong sales are likely to continue, not just on the back of healthy economic activities but also due to the recent increase in auto sales. Car sales showed an increase of 54 percent and two-wheeler sales showed an increase of 34 percent.
Topline Securities report adds that this increase in automobile sales will take the 11-month FY2020-21 sales to over 17.5 million tons, which is 18 percent higher year over year.
The RFO-based electricity generation also went up by 16 percent on an annual comparison, which will be another boosting factor for the OMCs.
In June 2021, the higher utilization of PSDP (as it is the final month of the current fiscal year) is also likely to increase the sales of petroleum products.
A monthly comparison shows an increase of one percent in petrol sales over April 2021 overall, while the HSD sales fell by two percent as the wheat harvesting season ended.
As far as the market share of different companies is concerned, on a monthly comparison, APL saw its hold on market improve from 8.1 percent in April 2021 to 8.5 percent in May 2021, primarily brought by higher HSD and FO sales. Likewise, HASCOL registered a notable improvement from a 2 percent market share in April 2021 to a 3.5 percent share in May 2021.
However, on a yearly comparison while PSO increased its share from 43 percent to 46 percent during the 11 months of the current fiscal year, other companies including APL, Shell and HASCOL saw their market share drop by 8.8 percent, 7.9 percent, and 4.1 percent, respectively, according to Topline Securities report.