Net profit of Indian Oil Corporation (IOC) rose 14.53 per cent to Rs 14,513 crore during January-March 2013 compared to Rs 12,671 crore in the year-ago period.
The rise in profit is attributed to the higher subsidy amount it received from the government for selling petroleum products below the market price.
The company’s income from operations rose 10 per cent to Rs 128,681 crore from Rs 117,281 crore during January-March 2012. IOC accounts for nearly 30 per cent of IndiaÂ’s refining capacity of 4.3 million barrels per day.
Ranbir Singh Butola, Chairman of the firm said the firm earned a gross refining margin (GRM) of $2.39 ($2.26) a barrel in the fourth quarter. Butola said the GRM was lower as it is not an integrated company and accounting is done based on the transfer pricing model.
Transfer pricing indicates the amount paid by one division of the company to another for using its good or services. This is in line with normal corporate practice to keep transparency in accounting procedures, Butola said, adding that otherwise, fourth quarter 2012-13 GRM would have been $5.90 a barrel.
The company hopes to process heavier crude, which is cheaper. The percentage of high sulphur crude in its crude basket is expected to touch 67 per cent in the next two-three years from 53.3 per cent currently.
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