IOC Q3 net profit rises to ₹9,220.85 cr

New Delhi: State-run Indian Oil Corp. Ltd (IOC) on Wednesday reported a multifold increase in its consolidated net profit for the October-December quarter at ₹9,220.85 crore.

During the same period last fiscal, the company had reported a net profit of ₹890.28 crore.

The increase in profit during the quarter under review comes in the backdrop of a fall in crude oil prices and higher marketing margins given that despite the ease in crude prices, the retail price of petrol and diesel remained stagnant.

IOC’s revenue from operations fell 2.26% to ₹2.23 trillion during the third quarter of the current fiscal from ₹2.28 trillion in the year-ago period.

However, a nearly 7% fall in expenses to ₹2.14 trillion during the period under review from ₹2.29 trillion in the corresponding period of the last fiscal aided the growth in profits.

The chairman and managing director of IndianOil, S.M. Vaidya, said: "IndianOil sold 72.272 million tonnes of products, including exports, during the period April - December 2023. Our refining throughput for first nine months of FY 2023-24 was 55.026 million tonnes and the throughput of the Corporation's countrywide pipelines network was 74.033 million tonnes during the period."

On a quarter-on-quarter basis, the company’s consolidated net profit declined 32% from ₹13,713.08 crore in the July-September quarter.

A company statement said that for the third quarter of FY23-24, IndianOil's product sales volumes, including exports, was 24.621 million tonnes. The refining throughput was 18.502 million tonnes and the throughput of the corporation's countrywide pipelines network was 25.212 million tonne

The marketing margin of oil marketing companies have improved of late amid the fall in crude oil prices. Rating agency ICRA on Tuesday said that the improved marketing margins could help in reducing retail fuel prices given crude prices remain stable.

“ICRA estimates that the OMCs’ net realization was higher by ₹11/liter for petrol and ₹6/liter for diesel vis-a-vis international product prices in January 2024 (till January 19). The marketing margins for petrol witnessed an improvement in the last few months after a sharp decline in September 2023. While the margins for diesel were negative till October 2023, they rebounded and turned positive from November 2023," said Girishkumar Kadam, senior vice president and group head of corporate ratings, ICRA Ltd.

Noting that retail selling prices of auto fuels have been unchanged since May 2022, he said that a headroom for their downward revision may emerge if crude prices remain stable.

On Wednesday, shares of IndianOil on the BSE closed at ₹143.50, higher by 3.24% from its previous close.