Indian Oil Corporation’s Q3 net profit up 52.2 percent

State-owned Indian Oil Corporation Monday reported an increase of 52.2 percent in its net profit for the quarter ended Dec 31, 2011 at Rs.2,488.44 crore from Rs.1,634.76 crore in the like period of last fiscal.

The company said in a regulatory filing at the Bombay Stock Exchange (BSE) that its total income grew by 42.18 percent at Rs.115,989.38 crore for the quarter under review at Rs.81,574.79 crore in the quarter ended Dec 31, 2010.

The company received Rs.16,423.91 crore in terms of government’s grants in the quarter under review, while it did not receive any aid in the second quarter which coupled with other factors resulted in a net loss of Rs.7,485.55 crore in the period ending September 30, 2011.

The company also received subsidies from central and state governments worth Rs.512.12 crore in the period under review.

“The company has accounted for budgetary support of Rs.24,624.76 crore for the period of April-December 2011 towards under-recoveries on sale of diesel, kerosene, LPG domestic in profit and loss account as revenue grants,” IOC said in a statement.

“The ministry of oil and natural gas has approved discount of Rs.20,189.17 crore for the period April-December 2011 on crude oil petroleum products from ONGC, GAIL, OIL and CPCC towards part of the under recoveries by IOC on sales of diesel, kerosene and LPG cylinders.”

The company’s chairman R.S. Butola told reporters here: “This (net profit) is in spite of the provision of Rs.6,168 crore towards the entry tax for crude in Mathura. The UP (Uttar Pradesh) government has introduced an entry tax on crude.”

“This has been factored in the quarterly results minus the impact of the entry tax the net profit would have been Rs.8,600 crore.”

According to Butola, the variation in profit is mostly on account of provision for the entry tax in Mathura of about Rs.6,168 crore, increase in the unmet under recoveries of around Rs.2,784 crore and rise in interest expenditure of Rs.2,285 crore in the nine month ended Dec 31, 2011.

The company said that consequent to the non-revision of retail selling prices in line with international prices, the company has suffered net under-recoveries of Rs.8,507.11 crore on sale of diesel, kerosene and LPG cylinder from April-December 2011.

The average gross refining margins for the April-December 2011 period was $3.41 per barrel, compared to $5.05 per barrel for the corresponding period last year.

For the nine months ended Dec 31, 2011 the company reported a net loss of Rs.8,715.81 crore compared to a net profit of Rs.3,540.32 crore for the corresponding period last year.

The company said that in view of loss for the nine months and due to uncertainty in estimation of profit for the year pending clarity on the extent of compensation for the under recoveries suffered on sales of diesel, kerosene and LPG cylinder, no provision has been made for current tax and deferred tax for the current period.