Home / Business and Economy / IOC Profit Soars 3x on LPG Aid Amidst Crude Volatility
IOC Profit Soars 3x on LPG Aid Amidst Crude Volatility
30 Oct
Summary
- Indian Oil's profit surged nearly threefold in the second quarter.
- Government compensation for domestic LPG losses boosted earnings.
- Higher crude oil prices increased operational expenses significantly.
Indian Oil Corporation announced a substantial increase in its second-quarter profit, with earnings rising to ₹21,630 crore for the period ending September 30. This represents a nearly threefold growth compared to the same period last year, when the profit stood at ₹7,610 crore.
The company's revenue from operations experienced a significant boost, growing by approximately 30% to ₹2.63 trillion. A key factor contributing to this revenue increase was ₹7,243 crore received from the central government as compensation for under-recoveries on domestic LPG sales.
Despite the positive profit trend, Indian Oil faced challenges due to escalating crude oil prices. Benchmark Brent crude saw an average increase of nearly 40% year-on-year, impacting procurement costs. Total expenses for the company rose by 23% to ₹2.39 trillion, with raw material costs climbing about 35%.
Looking ahead, the company cautioned about potential inventory losses in upcoming quarters if global crude prices were to fall. This highlights the ongoing volatility in the energy market and its direct impact on profitability.
