The Hindu Business Line : Positive trends: IOC hopes to post higher profit

"Crude prices have recently come down to the lowest level during this fiscal. Though this has also brought down our refining margin, we are no longer losing money on sales of petrol and diesel,'' Mr Behuria said.

Kolkata , Nov. 19

IF crude prices do not firm up again and oil bonds are issued, IndianOil may end up posting a profit growth in 2005-06 compared to 2004-05.

IOC's net profit had dropped by 30 per cent to Rs 4,891 crore in 2004-05 from Rs 7,005 crore due to the rise in crude prices and under-recoveries of Rs 7,777 crore.

In the first half of the current fiscal, its net profit dropped 67 per cent to Rs 895.49 crore.

Talking to newspersons here on Saturday, the IOC Chairman, Mr Sarthak Behuria, said the company expected to receive approximately Rs 6,000 crore of the Rs 11,500-crore issue of oil bonds, which is due to be cleared by Parliament in the winter session.

"Crude prices have recently come down to the lowest level during this fiscal. We have not seen such low prices for a while. Though this has also brought down our refining margin, we are no longer losing money on sales of petrol and diesel.

"For a change, petrol and diesel sales are now making positive contributions to our balance sheet.

"The under-realisation on subsidised kerosene and LPG are, however, much higher at Rs 800 crore a month compared to last year," the IOC Chairman said.

Till October-end when prices were still ruling high, the company had registered under-recoveries of Rs 9,000 crore.

On the proposed sale of IOC's 9.6 per cent stake in ONGC, Mr Behuria said the company stake is now worth over Rs 13,000 crore. "We have requested approval for the sale of this stake in tranches to fund our investment plans. However, our proposal is yet to be cleared by the Cabinet Committee on Economic Affairs," he added.

About LPG crisis, he said the scheduled shutdown of PSU refineries, coupled with the emergency shut down of Reliance Industries refinery at Jamnagar, was responsible for the crisis. "We have taken adequate measures to meet the demand through additional spot imports. However, there were delays as such and vessels were not readily available."

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