IndianOil wants review of petrol prices
Mumbai   15-Sep-2012

IndianOil, the country's largest refiner, called for a review of petrol prices to help shore up its shrinking margins at its annual general meeting on Friday.

The company's calls for higher petrol prices follows Thursday's R5.63/litre-hike on diesel prices which is expected to benefit refiners.

The diesel hike and the news of the US Federal Reserve's quantative easing measures lifted the stock markets on Friday, with the Sensex closing at 443.11 points.

High crude prices have been cramping Indian Oil's refining margins. But a rise in petrol prices would help ease some pressure. The company's chairman RS Butola moved to assuage shareholders' concerns about rising costs, saying the refiner was trying to source heavier crude oil, which is cheaper.

The company hopes a decision on petrol prices will be made soon, Butola said.

The shareholders expressed their concerns on the company's high debt levels and some said they were disappointed by IndianOil's decision to reduce its dividend.

The company, which has paid a dividend for the last 45 years, slashed its to R5/- per share of 10/- each on the paid-up share capital, from R9.50 per share a year earlier.

IndianOil's borrowings were R75, 447 crore at the end of March 31, 2012, compared with R52,734 crore, a year earlier. IndianOil's after-tax profit nearly halved to R865 crore in fiscal 2011-12. IndianOil's shares, which have lost nearly half of their value over the past 2 years, closed down 2.2% at R 248.70 on Friday.