Indian Oil Q1 net profit drops 45% on lower refining margins

New Delhi, Aug 3 (IANS) State-run refiner Indian Oil Corp (IOC) on Thursday reported a massive 45 per cent fall in its standalone net profit for the first quarter ended June, caused by a drop in refining margins and higher inventory losses.

IOC posted a net profit of Rs 4,548.51 crore in the quarter under consideration, as compared with the Profit After Tax (PAT) of Rs 8,268.98 crore in the same quarter of the last fiscal.

The company's average gross refining margin (GRM), or earning per barrel of crude refined, during the first quarter less than halved to $4.32 per barrel, from $9.98 per barrel in the same quarter of 2016.

Indian Oil's revenue during the quarter in question jumped to Rs 1,29,418.11 crore from Rs 1,07,670.95 crore in the corresponding quarter a year ago.

Announcing the results here, the company said it sold 20.736 million tonnes (MT) of fuel in the domestic market and exported 1.772 MT during the first quarter of 2017-18. This was against 20.415 MT sold at home and 0.963 MT of exports in the same period of the last fiscal.

IOC also said in a statement that during the first quarter it received Rs 876.38 crore from the government as subsidy to compensate for selling public distribution (PDS) kerosene at prices below the market rate.

State-run oil marketing companies (OMCs) continue to raise prices of subsidised kerosene by 25 paise every fortnight in a move to bring prices closer to market levels.

Meanwhile, available data showed the price of the Indian basket of crude oils again crossed the psychologically important level of $50 a barrel last week and closed trade on Wednesday at $50.83, which was a drop on its previous day closing price of $51.24.

Indian Oil stock closed trade on Thursday at Rs 386.90 a share, up Rs 17, or by 4.60 per cent, over its previous close on the Bombay Stock Exchange (BSE).