IOC Q2 Results Highlights: Profit jumps 4,128% to ₹7,610 crore; revenue at ₹2.02 lakh crore

Operating margins improved significantly to 5.28% in Q2 FY26 from 0.03% in Q2 FY25 and 4.01% in Q1 FY26.

The government had earlier allowed OMCs (like IOC, BPCL, HPCL) to maintain a “buffer account” to record the gap when the market price of LPG was lower than the cost of supplying it to customers. Essentially, this account tracks how much loss the OMCs bear on subsidised LPG sales, which the government may later compensate.

As of September 2025, the company had a negative balance of ₹25,768.77 crore in this buffer — meaning the company had absorbed that much loss, which wasn’t yet reimbursed.

Recently, through letters issued in October 2025, the government approved ₹14,486 crore as compensation to partially cover those losses for LPG sales up to FY25 and those expected in FY26. This compensation will be paid monthly over a year starting in November 2025.

The company will recognise (record) this compensation as revenue only when it actually becomes receivable each month, not all at once.

The average Gross Refining Margin (GRM) for the period April–September 2025 is $6.32 per bbl (April–September 2024: $4.08 per bbl). The core GRM, or the current price GRM, for the period April–September 2025, after offsetting inventory loss/gain, stands at $7.89 per bbl.

Revenue from operations jumped 4% YoY to ₹2,02,992.34 crore in Q2 FY26, as compared to ₹1,95,148.9 crore in the same period a year ago. The low base from last year, due to an exceptional item helped drive the bottomline.

IOC posted a 4,127% YoY rise in Q2 profit after tax (standalone) to ₹7,610.45 crore, as against ₹180.01 crore in the same period last year.

IOC could post 2174% YoY jump in Q2 PAT, as per JM Financial. The brokerage expects the OMC to post ₹4093.7 crore profit. Meanwhile, sales could decline 0.1% YoY and 10.8% QoQ to ₹ ₹194,972.6 crore, said the brokerage.

IOC share price jumps 3.23% to end at ₹155.20 on the BSE. The stock closed the session near to the day's peak of ₹155.35.

OMCs’ Q2FY26 YoY performance could be stronger, driven by higher GRMs (along with lower inventory losses) and reduced LPG under-recoveries. Singapore GRMs have improved by USD 0.3/bbl YoY (down USD 1.6/bbl QoQ) in Q2, while retail margins have decreased by ₹0.2/ ₹1.6 per litre YoY (down ₹1.8/ ₹4.1 per litre QoQ) in petrol and diesel, to ₹8.5 and ₹4.1 per litre, respectively. In addition, with a ₹50 per cylinder hike in LPG prices and a decline in propane prices, LPG under-recoveries for the quarter could reduce to ₹20–30 billion in Q2, compared with ₹79 billion each in Q2FY25 and Q1FY26.

We anticipate IOCL's Q2FY26 EBITDA to rise by 2.6x YoY (+9% QoQ), driven by improvement in refining margins (+2.8x YoY / +1.8x QoQ) and lower under-recoveries on LPG sales due to higher cylinder prices and lower propane prices (-3% YoY). The petrochemical segment is likely to remain weak on muted realizations and spreads YoY. Singapore GRMs rose 13% YoY, led by an increase in global product cracks. We expect throughput to rise 7% YoY but decline 4% QoQ.

— Views by Nuvama Research

IOC profit could grow 1360% YoY to ₹2627.8 crore, while the figure could dip 54% QoQ. We expect IOC’s EBITDA to decline 36% QoQ (yet up 114% yoy on low base), said Kotak Institutional Equities (KIE).

With likely lower adventitious losses QoQ, and stronger diesel cracks GRMs should be better. But, with no retail price change, higher diesel cracks, and weaker rupee, marketing earnings will likely be lower. We assume OMCs to account for Rs30 bn compensation in 2Q, said Kotak Institutional Equities (KIE).

IOC shares gain 3% ahead of the Q2 results 2025. The stock hit the day's high of ₹154.45 on the BSE. Maharatna PSU stock has gained 11.67% on YTD basis and 5% in a year.

Pursuant to regulation 29(1) & (2) and 50(1) of the SEBI (Listing Obligations & Disclosure Requirements), Regulations 2015, it is hereby informed that a Board Meeting of the Company is scheduled on Monday, 27 October 2025, inter alia, to consider and approve the Unaudited Financial Results of the Company for the quarter and half year ended 30th September 2025, IOC said in a filing earlier this month.