Gulf Oil Lubricants India Ltd (GULFOILLUB) Q2FY27 Concall Transcript - Sep-2026 Qtr
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Moderator: Ladies and gentlemen, good day, and welcome to Gulf Oil Q2 FY '27 earnings conference call hosted by ICICI Securities Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note this conference is being recorded. I now hand the conference over to Mr. Probal. Thank you, and over to you, sir.
Probal Sen (ICICI Securities Limited): Yeah, thank you so much. Thank you to everyone for making the time to attend this post-Q2 result call discussion call for Gulf Oil Lubricants. As always, we are joined by the members of the senior management of the company, Mr. Ravi Chawla, who is the Managing Director and CEO, and Mr. Manish Gangwal, Whole-Time Director and the CFO of the company. The format will be as always. Ravi sir will probably, Ravi sir and Manish sir will give their opening brief on the results, and thereafter we can get into an interactive Q&A session. Without further ado, I'll hand over to the management. Ravi sir?
Ravi Chawla (Gulf Oil Lubricants India Ltd): Yeah. Thank you. Good afternoon, everyone, and thank you for joining our quarter two call. We would like to start off by obviously passing on our festive greetings to all of you in advance for the coming season. And very happy to share with you that the quarter two for us has also been a very robust quarter. We've continued the strong lubricants volume growth which, obviously, we saw in quarter one. Quarter one, I would say, was also a quarter where there were supply issues and we showed agility, and we grew more than three, four times the market. And quarter two, again, kind of is a testimony to our strong business model, which is very robust and consistent. So, the 16% growth in a quarter in which we expected the monsoon, being a low seasonal quarter, would, you know, play its role. But really delighted to share with you that the team has come up with these results, which are again, I think, industry leading, with 16% growth. Despite a tough situation internally in terms of cost challenges, and also West Asia crisis, we are seeing obviously the cost remaining what they were. And I think for that, it's obviously been a very, very good all-round show by all segments. So, each and every segment of ours has been able to grow. Even the B2C segment has has obviously shown that we're able to get primary, secondary sales. Definitely, the two segments which came out very well, as we have given in our press release, is the OEM franchise workshop, even OEM factory fill picked up for us, double digit, in fact, OEM franchise workshops high double digit. And the B2B industrial segment also was a very good segment for us in this quarter, again, going into high double digit. We continued our focus to also look at new customers. And I think some of the B2B industrial customers that came in, nearly third of the incremental growth is from new customers. So, very happy to share that. And we have a large number of OEM franchise workshops, about 7,000 numbers with OEMs with who have been with us, and we have a very good portfolio of OEMs right from the commercial vehicle to the car OEMs to the tractor OEMs to industrial OEMs right across India. So, that has really been a very good positive for us. We've been able to really show the agility continued in a challenging environment. Manish will talk a bit more later about some of those things, but I think our calibrated price increases have also been able to, you know, really give us a good return overall, given that there were lots of challenges in the market as we have seen. And, you know, we also are happy to share that during this quarter we've started the biggest investment ever in the history of Gulf in terms of an advertising campaign with our campaign for our Pride product, and also repositioning of our, you know, positioning on born to be [Foreign language], what we say, [Foreign language], that is actually performance beyond limits. So, that was a start of our motorcycle campaign. Our
Ravi Chawla (Gulf Oil Lubricants India Ltd): engagement BTL activities continued with greater vigor and we also continue to focus on premiumization as part of our strategy and continue to gain momentum in this. We also had the Chennai plant as you know working towards a lot of ESG and environment initiatives. The Chennai plant was awarded the IGBC Platinum certification and really that is a significant milestone again showing our strong commitment to sustainability. I think overall a very good quarter for us and given what we are seeing the monsoon quarter a very good result for us. And definitely there are challenges but as we see, our growth engines are going very strong and one of the key is the agility in execution, strategic pricing interventions, effective opportunity conversion supported by customer acquisition and growth. I'll now hand over to Manish to give a bit of granularity on a few things and of course we will be happy to take your questions after that. Manish?
Manish Gangwal (Gulf Oil Lubricants India Ltd): Thank you Ravi. Good afternoon everyone. So, as Ravi mentioned, we had a very strong quarter on the back of a strong Q1 back to back we have delivered another quarter of growth momentum where our volume grew by nearly 16% and revenues grew by 44%. And you know this has been, I would say, a robust volume led profitable growth where you know our EBITDA also in line with our volume and revenue growth have delivered a strong 37% growth on quarter-on-quarter basis YoY. And also at the same time it is important to know that we have been able to maintain our margins in more or less near to the guided band of 12% to 14%. The margin for the quarter are 11.8% which is very close to our guided band. And on the per liter basis which we have been highlighting in our previous fall also that in this inflationary environment situations which it is better to look at you know a per liter which we have been able to protect our per liter margins. Which means the cost increases have been passed on to customers, consumers on per liter basis. And that is that in such a challenging environment where you know the supply security was important for our customers, our consumers, we have been able to deliver every single liter which our customers and our partners, our OEM partners were looking forward to. So, as Ravi mentioned you know, it has been a very agile performance in the environment given outside environment was very challenging. Cost increases were happening, price increases were taken on timely basis and the result is that we have delivered one of our strongest quarter which is quarter two. Overall, our core volume was core lubricant volume was 47,000 KL versus last year 40,500 KL which means we have added 6,500 KL during the quarter and that gives a 16% growth. AdBlue and YTD 95,000 KL which means over last year H1 we have grown 17% in volume roughly. AdBlue in this quarter as being we all know that this was a monsoon quarter so there were some lesser movements of vehicles during this quarter especially the truck movements are slightly lower because of monsoons in various parts of India. And that results in slightly lower consumption also in certain categories and one of the reason why our AdBlue which is 33,000 KL in this quarter that is there was slight sort of a lesser volume we would say as compared to our usual but on the on the H1 basis we are almost flat on the AdBlue. We have delivered close to 73,000 KL which is flatish kind of AdBlue delivery. But on the lube core lube size core lubes volumes we have done exceptionally well. Clearly 3 to 4x of the industry growth we have been able to deliver in H1. I think with this we would like to we would be happy to take questions. Thank you.
Moderator: Thank you, sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Pankaj from Avis Capital. Please go ahead.
Pankaj (Avis Capital): Yeah, very good afternoon. Thank you and thank you for the opportunity and congratulation
Pankaj (Avis Capital): a quick question on first question is on working capital, our inventory days and debtor days have meaningfully increased in H1 if you compare it with FY '26 numbers. So, just wanted a little more color and clarity on that. Is it a normalized kind of working capital requirement we have kind of done in H1 or are we looking forward to see some improvement in coming times?
Manish Gangwal (Gulf Oil Lubricants India Ltd): Yeah. So, you see in the, as we mentioned, there have been significant cost increases and the price increases. So, both inventory values and receivable values have gone up, and which are reflecting in the working capital increase. While in terms of number of days, we are still in the in the usual our band of, you know, gross 95 to 105 days. So, in terms of number of days we don't we have not seen any meaningful increase, but, yes, absolute values have gone up sheer because of the pricing which has been tremendously high.
Pankaj (Avis Capital): The working capital historically has been at a kind of sub-80 levels. So, are we expecting that to increase to say 100 odd days level? Is that what the guidance for the coming times is?
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