Inventory gains fuel Indian Oil's Q3 profit to Rs 7,883 crore
New Delhi   31-Jan-2018

Indian OilBSE -1.79 %'s third quarter profit almost doubled to Rs 7,883 crore on huge inventory gains, sending shares up 4.2% on Tuesday.

The company's board declared an interim dividend of Rs 19 per equity share and recommended an issue of one bonus share for each existing share in the company.

Indian Oil's profit climbed to Rs 7,883 crore in the Oct-Dec period from Rs 3,995 crore in the year-ago period. Revenue rose to Rs 130,865 crore from Rs 115,630 crore a y .



The profit boost came mainly on inventory gains, Indian Oil Chairman Sanjiv Singh said. A sharp rise in oil prices in the December-quarter gave Indian Oil an inventory gain of Rs 6,301 crore, compared to a gain of Rs 3,051 crore in the year-ago period.

The gross refining margin (GRM) for the third quarter was $12.32 per barrel, much higher than $7.67 per barrel a year earlier.

With its key products like petrol and diesel outside GST, Indian Oil has gathered a stranded input credit of Rs 700 crore since July when the GST was rolled out, A K Sharma, Director (Finance) said. Annual negative impact of GST on Indian Oil is estimated to be Rs 2000 crore, he said.

Indian Oil said it has accounted for budgetary support of Rs 2,250 crore in April-December as revenue grants on sale of subsidised kerosene and there was no under-realization on this account.

During the third quarter, Indian oil sold 22.81 million tonnes of oil products. The refining throughput was 18.23 million tonnes, and pipeline throughput was 22.41 million tonnes.

Shares in Indian Oil, valued at about Rs 200,000 crore, closed 4.23% up at 415.60 onon Tuesday when the benchmark Sensex ended 0.69% lower.