Indian Oil Corporation Net Profit Soars To Rs 13,750 Crore In Q1

New Delhi:

India’s high oil agency IOC on Friday reported a internet revenue of Rs 13,750 crore in three months to June 30 – the very best in a decade – as margins on petrol and diesel turned constructive on softer oil costs.

Standalone internet revenue of Rs 13,750.44 crore, or Rs 9.98 per share, in April-June (the primary quarter of present fiscal 12 months 2023-24) in contrast with a lack of Rs 1,992.53 crore in the identical interval a 12 months again, in keeping with an organization’s inventory change submitting.

The revenue was virtually 37 per cent greater than Rs 10,058.69 crore internet revenue within the previous quarter and greater than half of the corporate’s best-ever annual incomes of Rs 24,184.10 crore recorded in 2021-22 (April 2021 to March 2022).

IOC posted a internet revenue of Rs 14,513 crore in January-March 2013 after it acquired gas subsidy for multiple quarter throughout these three months.

Final 12 months, IOC and different government-owned gas retailers – Bharat Petroleum Company Ltd (BPCL) and Hindustan Petroleum Company Ltd (HPCL) – froze retail petrol and diesel costs to cushion home shoppers from rising worldwide oil charges.

That freeze led to the three retailers struggling heavy losses in not simply April-June 2022 but in addition within the subsequent quarter.

Margins on petrol and diesel turned constructive following softening of worldwide oil costs within the June quarter, however charges weren’t revised, and the businesses recouped losses they incurred final 12 months.

BPCL earlier this week reported a internet revenue of Rs 10,644 crore within the June quarter. HPCL is because of announce its first-quarter earnings subsequent week.

The autumn in oil costs meant that income from operations for IOC fell 2.36 per cent to Rs 2.21 lakh crore.

Operational efficiency throughout the quarter improved as earnings earlier than curiosity, taxes, depreciation and amortization (EBITDA) elevated 44.5 per cent to Rs 22,163 crore from Rs 15,340 crore, sequentially.

The corporate earned USD 8.34 on turning each barrel of crude oil into gas throughout the quarter ended June 30 in opposition to a gross refining margin (GRM) of USD 31.81 per barrel in the identical interval final 12 months, the submitting stated.

Core GRM or the present value GRM for the interval April-June 2023 after offsetting stock loss/acquire got here to USD 9.05 per barrel.

IOC stated gas gross sales rose to 21.8 million tonnes within the first quarter from 21.2 million tonnes a 12 months again. Its refineries processed 18.26 million tonnes of crude oil, up from 17.59 million tonnes in April-June 2022.

IOC, BPCL and HPCL quickly deserted the each day value revision final 12 months and haven’t revised petrol and diesel costs according to the fee. And the losses they incurred when the oil costs have been greater than the retail promoting costs are recouped with charges dropped.

The three companies have been making constructive margins on petrol for the reason that fourth quarter of the 2022 calendar 12 months however diesel, which accounts for the majority of the gas gross sales, had been within the purple.

However in Might, margins on diesel turned constructive with a small 50 paise a litre revenue.

Worldwide oil costs had spiked to USD 139 per barrel in March 2022 within the aftermath of the Russia-Ukraine conflict. They cooled to USD 75 throughout Might-June.

At peak, oil companies misplaced Rs 17.4 per litre on petrol and Rs 27.7 a litre on diesel. Within the October-December quarter, oil companies earned Rs 10 a litre margin on petrol however misplaced Rs 6.5 on diesel. Within the following quarter, the margins on petrol moderated to Rs 6.8 a litre whereas diesel earned Rs 0.5 per litre.

Oil costs have firmed up this month, and the basket of crude oil that India buys has averaged USD 80 per barrel thus far, making a discount in charges tough.

Holding costs when enter price was greater than retail promoting costs led to the three companies posting internet earnings loss. They posted a mixed internet lack of Rs 21,201.18 crore throughout April-September regardless of accounting for Rs 22,000 crore introduced however not paid LPG subsidy.

Worldwide oil costs have been turbulent within the final couple of years. It dipped into the adverse zone at the beginning of the pandemic in 2020 and swung wildly in 2022 — climbing to a 14-year excessive of almost USD 140 per barrel in March 2022 after Russia invaded Ukraine earlier than sliding on weaker demand from high importer China and worries of an financial contraction.

However, for a nation that’s 85 per cent depending on imports, the spike meant including to already firming inflation and derailing the financial restoration from the pandemic.

So, the three gas retailers, who management roughly 90 per cent of the market, froze petrol and diesel costs for the longest length in at the very least twenty years. They stopped each day value revision in early November 2021 when charges throughout the nation hit an all-time excessive, prompting the federal government to roll again part of the excise responsibility hike it had effected throughout the pandemic to benefit from low oil costs.

The freeze continued into 2022 however the war-led spike in worldwide oil costs prompted a Rs 10 a litre hike in petrol and diesel costs from mid-March earlier than one other spherical of excise responsibility minimize rolled again the entire Rs 13 a litre and Rs 16 per litre improve in taxes on petrol and diesel affected throughout the pandemic.

That adopted the present value freeze that started on April 6, which nonetheless continues.
 

(Aside from the headline, this story has not been edited by NDTV employees and is revealed from a syndicated feed.)