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Downward Integration Between MRPL & OMPL: A Paved Road to Better Profitability

News

Mangalore Refinery and Petrochemicals Limited (MRPL) has initiated its downward integration by amalgamation with ONGC Mangalore Petrochemicals Limited (OMPL) - a synergy which will provide higher returns for stakeholders.

Source:  ET

SNP Insights

Downward integration between MRPL & OMPL, will ensure more profitability  for the former, with better gross refinery margin. As 80% of total Naptha consumed by OMPL is supplied by MRPL, integration will ensure market security for MRPL & supply security for OMPL. Knock on effect of the backward integration would be that, it will enable the companies to better presume raw material cost & so more accuracy in forecasting profitability margin will be there & hence better investment decision can be taken.

Source: SNP Infra Research