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IndianOil Corp Ltd (IOC) reported an 82.47 per cent fall in net profit for the second quarter of the current fiscal after it received lower compensation from the government for selling fuels at subsidised rates and incurred losses on foreign exchange.
The currency exchange loss during the quarter was Rs 2,158 crore against a gain of Rs 2,289 crore in the corresponding quarter last year, said R.S. Butola, Chairman.
“In the second quarter, we had an unmet under-recovery (revenue loss) of Rs 413 crore, while in the same quarter of the previous year, we had an over-recovery of Rs 3,850 crore. This has brought the profit down.”
IOC, the nation’s largest refiner, suffered a revenue loss of Rs 18,291 crore (against Rs 20,388 crore last year) for selling diesel, kerosene and domestic LPG at government-controlled prices.
As part of the burden-sharing mechanism of the Government, the upstream companies – ONGC, GAIL (India) Ltd and Oil India Ltd— compensated Rs 8,634 crore, while Rs 9,243 crore was provided by the Government.
The public sector company is left with a gap of Rs 413 crore of uncovered revenue loss.
“At current prices, IOC will end the fiscal with an under-recovery of Rs 71,200 crore. The industry will have an under-recovery of Rs 1.3 lakh crore,” Butola said.
IOC’s income from operations increased 4.1 per cent to Rs 1.1 lakh crore during July-September from Rs 1.06 lakh crore a year ago.
The company shelled out Rs 1,354 crore as interest cost during the quarter against Rs 1,513 crore in the last corresponding period.
The gross refining margin—the difference between the value of petroleum products sold and the cost of processing crude— in the second quarter stood at $7.43 a barrel against $6.07 a barrel.
On Friday, IOC’s shares gained 1.62 per cent to Rs 213.20 on BSE even as the benchmark Sensex shed 0.75 per cent to close the day’s trade at 20,666.15 points.
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