IOC's Q4 Profit Falls 49% Amid Petrochemical Losses, Fuel Price Cuts

New Delhi: With losses in the petrochemical business and shrinking margin after a pre-election fuel price cut, the country’s largest oil retailer, Indian Oil Corporation Ltd (IOC) on Tuesday reported consolidated net profit of nearly Rs 5,488 crore for the fourth quarter in the financial year 2023-24, a decline of 49 percent from the year-ago period. Lower profit by the oil marketing company comes as crude oil prices rose 16 percent in the first three months of 2024. The state-run oil retailer posted a profit of Rs 10,841.23 crore in the same period last year.

However, the company estimated its net profit of Rs Rs 4,837.69 crore in January-March compared with Rs 10,058.69 crore a year ago and Rs 8,063.39 crore in the preceding quarter. Despite a fall in profit, IOC also declared a dividend of Rs 7 per equity share, subject to approval by the members of the company in the annual general meeting. This is in addition to the interim dividend of Rs 5.00 per equity share paid during the year by the state-owned oil retailer, according to a stock exchange filing by the company.

“The profit was lower as refining margins dipped, the petrochemical segment turned negative, and the firm, last month, cut petrol and diesel prices by Rs 2 per litre each despite crude oil prices edging up. Also, the company was not compensated for the Rs 1,017 crore loss it incurred on holding domestic cooking gas prices by the government,” the filing said.

IOC chairman SM Vaidya said that the company sold 97.551 million tonnes of products, including exports, during FY 2023-24. “Our refining throughput for FY 2023-24 was 73.308 million tonnes and the throughput of the corporation’s countrywide pipelines network was 98.626 million tonnes during the year. The gross refining margin for FY 2023-24 was US $12.05 per bbl as compared to $19.52 per bbl in the previous financial year,” Vaidya said in a statement.

“For the fourth quarter of FY 2023-24, Indian Oil's product sales volumes, including exports, was 25.279 million tonnes. The refining throughput was 18.282 million tonnes and the throughput of the corporation’s countrywide pipelines network was 24.593 million tonnes during the quarter,” the IOC chairman added