The net profit of India’s largest oil marketing company, Indian Oil Corporation (IOC), plummeted by 75% year-on-year in Q1 of FY2024-25, primarily due to weak Gross Refining Margin (GRM) and high crude oil prices. The state-run oil PSU reported a consolidated net profit of Rs 3,722.63 crore for the June quarter of the current financial year, a significant decline from Rs 14,735.30 crore in the same period of the previous year. On a quarter-on-quarter basis, the consolidated net profit dropped by 32.16%.
IOC’s standalone net profit also fell sharply, decreasing by 81% from Rs 13,750.44 crore in Q1 of FY2023-24 to Rs 2,643.18 crore in Q1 of the current fiscal year. This represents a quarter-on-quarter decline of 45.36%.
The average GRM for Q1 of FY2024-25 was USD 6.39 per barrel, lower than the USD 8.34 per barrel recorded in the April-June period of FY2023-24. The core GRM, after accounting for inventory loss, was USD 2.84 per barrel for Q1 FY25.
In terms of revenue, IOC’s standalone total income for the June quarter of FY2024-25 was Rs 2,15,988.76 crore, a 2.33% decrease from Rs 2,21,145.42 crore in the same quarter of the previous year. On a quarter-on-quarter basis, the total income fell by 1.77%. Despite the slight drop in total income, expenses increased due to higher costs of materials consumed and increased impairment loss.
Consolidated total income decreased from Rs 2,26,041.72 crore in Q1 of FY2023-24 to Rs 2,20,396.99 crore in Q1 of FY25, a decline of 2.49%. On a quarter-on-quarter basis, the consolidated total income dropped by 2.09%. Indian Oil’s consolidated Profit before Tax (PBT) was Rs 4,841 crore in Q1 FY25, down from Rs 19,450.11 crore in the same period of the previous year. The standalone PBT was Rs 3,452.71 crore, compared to Rs 18,073.84 crore in the June quarter of the previous fiscal year.
Earnings per Share (EPS) dropped from 10.48% in Q1 FY24 to 2.56% in Q1 FY25. “The Ministry of Petroleum and Natural Gas (MoPNG), via a letter dated 30.04.2020, informed Oil Marketing Companies (OMCs) that if the Market Determined Price (MDP) of LPG cylinders is lower than the Effective Cost to Customer (ECC), the OMCs would retain the difference in a separate buffer account for future adjustment. However, as of 30th June 2024, the Company had a cumulative net negative buffer of Rs 5,156.53 crore because the retail selling price was less than the MDP,” stated Indian Oil.
