Following the reimbursement of oil subsidy by the union government, public sector refiner Indian Oil Corp (IOC) posted a net profit of Rs 9,611 crore in the quarter ended September 30.
In the year-ago period, the firm posted a net loss of Rs 7,485 crore. IOC, which reported the largest quarterly net loss by a corporate in the June quarter at Rs 22,451 crore as it did not get any fuel subsidy from the government, received a lumpsum Rs 16,094 crore compensation for Apr-Sep 2012.
The other two state-run oil marketing companies (OMCs)- BPCL and HPCL – also reported profits for the July-September 2012 quarter because of reimbursement of the subsidy by the government.
The three oil marketing companies (OMCs) together had reported a total under-recovery of Rs 85,586 crore for the April-September 2012 period. However, they were compensated only for Rs 60,160 crore.
This meant nearly 30 percent of the under-recovery had to be absorbed by the marketing companies. Indian Oil had to absorb 13,635 crore of under-recoveries, while BPCL absorbed Rs 6,133 crore.
In other words, the profits from the second quarter were insufficient in compensating for the losses of the April-June quarter.
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