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State-run Indian Oil Corporation (IOC) on Friday reported a consolidated net profit of ₹14,434 crore for the April-June quarter in FY24 aided by higher marketing margins.
The country’s largest oil marketing company (OMC) had posted a consolidated net loss (attributable to company shareholders) of ₹279 crore in Q1 FY23. However, on a sequential basis, the profit was up 40 per cent from ₹10,290 crore in Q4 FY23.
The company’s consolidated total income fell by 12 per cent y-o-y and 3 per cent q-o-q to ₹2.26-lakh crore during the June quarter in the current financial year.
On a standalone basis, IOC’s revenue from operations stood at ₹2.21-lakh crore in Q1 FY24 compared to ₹2.52-lakh crore in the year-ago period. Net profit was ₹13,750 crore compared to a loss of ₹1,993 crore, mainly on account of higher marketing margins.
Softening crude price
After the Russia-Ukraine conflict in February 2022, international crude oil prices rose to a record high of around $138 per barrel in March 2022. The prices have now come down to the level of $78-80 per barrel. Domestic OMCs have not revised retail prices of petrol and diesel since April 6, 2022 and as a result incurred heavy under recoveries.
However, as international crude oil prices started to soften since Q4 2022, the companies have been witnessing a positive impact on their marketing margins, which is reflected in their quarterly performance.
“Our refining throughput for Q1 FY24 is 18.752 million tonnes (MT) and the throughput of the corporation’s countrywide pipelines network including gas pipelines is 24.951 MT during the same period,” IOC Chairman S M Vaidya said.
The company achieved a crude throughput of 18.9 MT in Q1FY23 and 19.2 MT in Q4 FY23.
Gross refining margin
IOC’s Average Gross Refining Margin (GRM) for April-June 2023 stood at $8.34 per barrel (against April-June 2022: $31.81 per barrel). Its core GRMs or the current price GRM for April-June 2023 after offsetting inventory loss/ gain stood at $9.05 per barrel.
In FY23, the refiner’s GRM stood at $19.52 per barrel against $11.25 in FY22. The core GRM after offsetting inventory loss/ gain came at $20.14 per barrel in FY23.
Analysts said that in Q1 FY24, IOC’s GRMs are likely to remain subdued but are expected to be countered by strong marketing margins. However, GRMs are likely to improve in H2 FY24 on account of anticipated increase in demand.
IOC sold 24.407 MT of petroleum products, including exports, during the first quarter of FY24.
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