The under recovery in liquefied petroleum gas (LPG) has risen by almost 34 per cent on a monthly basis to ₹327 per 14.2 kg domestic cylinder.
Vikas Kaushal, Chairman of State-run Hindustan Petroleum Corporation (HPCL), in a post-result analyst call said that under-recoveries on LPG have risen from ₹245 per cylinder in October to ₹327 a cylinder in November 2026.
The company’s total under recovery in Q2 FY27 was roughly ₹18,049 crore. This is on account for selling LPG to consumers below the prevailing market rates. Under recovery during March 31, 2026 and September 30, 2025 was around ₹12,798.67 crore and ₹14,240.64 crore, respectively.
On an industry basis, the under-recovery was around ₹721 per cylinder in June, which fell to roughly ₹500 a cylinder a month later. The under recovery per cylinder stood at about ₹188 in August, which rose to roughly ₹210 a cylinder in September.
The cumulative under recovery of PSU OMCs—Indian Oil Corporation (IOCL), HPCL and Bharat Petroleum Corporation (BPCL)—rose from roughly ₹51,000 crore in June to over ₹62,000 crore in August 2026.
Freight rates also added to the cost. The HPCL management told analysts that freight rates almost doubled between Q1 FY27 and Q2 FY27.
For instance, US LPG is linked to Mont Belvieu prices ($0.68 per gallon in August 2026, equivalent to around $360 per tonne) which is generally benched lower than Saudi CP, but longer voyages to India raises its delivered cost, Equirus Securities had pointed out.
“Houston–Asia VLGC freight exceeded $200 per tonne mark in mid-April 2026 and continued to rise to >$300 in August as stronger eastbound demand tightened vessel availability,” the brokerage added.
Kaushal also informed the analysts that the company has refinanced the entire loan of ₹45,000-50,000 crore for the HPCL Rajasthan Refinery (HRRL), which is operating the country’s latest refinery located at Barmer in Rajasthan.
“There has been another major development on HRRL post the commissioning. We have significantly altered the debt structure of the company. We have refinanced the entire debt of HRRL of ₹45-50,000 crores. All agreements were signed end of September, and from October 3rd, it has taken place. So the entire debt has been restructured, and we are probably about 105 basis points lower than what the original rate of,” Kaushal said.
The debt restructuring exercise will give an annual benefit of about ₹470-500 crore, and the benefits will start flowing in from October 3rd itself when the revised rates get applicable, he noted.
“We are expecting to make further equity calls in the next one or two quarters, and getting the total debt burden down. An apple-to-apple comparison would say that we’ll probably get the interest burden down by ₹1,000 odd crore, which is a significant improvement over last year,” Kaushal added.
Published on October 23, 2026
