Portfolio Rejig: LIC cuts stake in state-owned refiner BPCL to 6.75%

State-owned insurers and one of India’s largest asset managers, Life Insurance Corp (LIC), have reduced their stake in refiner Bharat Petroleum Corporation Ltd (BPCL), reducing their stake from 8.75% to 6.75%. The cut comes as the state-owned refiner has reported a strong set of numbers for the September quarter, boosted by better refining margins and healthy fuel demand.BPCL posted a sharp performance improvement for Q2FY26, with net profit rising 169% year-on-year to Rs 6,442.53 crore. This compares to Rs 2,398 crore in the same quarter last year.

The increase was largely driven by stronger gross refining margins (GRMs), which rose to $10.78 per barrel from $4.41 per barrel a year earlier. Higher GRMs reflect how much a refinery earns from converting crude oil into end products such as gasoline, diesel and jet fuel, and this improvement helped offset the slight decline in throughput volumes.

Operating revenue rose 3% to Rs 1.21 lakh crore during the quarter. BPCL’s refineries processed 9.82 million tonnes of crude oil at a utilization rate of 111%, compared to 10.28 million tonnes processed in the same period last year.

Domestic sales in the quarter amounted to 12.67 million tonnes, a modest growth of 2.26% from last year’s 12.39 million tonnes. The company had also declared an interim dividend of Rs 7.5 per share, reflecting improvement in profitability and cash flows.

Also read: Infosys’ Rs 18,000-crore share buyback starting tomorrow: What you need to know before tendering your shares. It should be noted that large institutional investors such as LIC routinely rebalance portfolios, and the reduction in stake does not necessarily reflect negatively on the company’s long-term prospects. BPCL’s performance will continue to depend on the evolution of crude oil prices, refining spreads and domestic fuel demand, although the quarter’s high GRMs are unlikely to continue at the same levels.