IOC, BPCL, HPCL witnesses Rs 690 bn net profit from Apr-Dec
OIL & GAS

IOC, BPCL, HPCL witnesses Rs 690 bn net profit from Apr-Dec

State-owned fuel retailers Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation reported a bumper profit totalling over Rs 690 billion in the first nine months of the current fiscal, exceeding their annual earnings in pre-oil crisis years. The combined net profit of IOC, BPCL, and HPCL in April-December FY24 surpassed their annual earnings of Rs 393.56 billion in the pre-oil crisis year.

The retailers have resisted calls to revert to daily price revision and pass on the softening in rates to consumers. They argue that prices continue to be extremely volatile, rising on one day and falling on the other, and that their past losses have not been fully recouped.

The three companies, which control roughly 90 percent of India's fuel market, have 'voluntarily' refrained from changing petrol, diesel, and cooking gas (LPG) prices for almost two years now, resulting in losses when input costs were higher and profits when raw material prices were lower.

During April-September 2022, they posted a combined net loss of Rs 212.01 billion despite accounting for a Rs 220 billion announced but not paid LPG subsidy for the previous two years.

Subsequent softening of international prices and the government giving out LPG subsidy helped IOC and BPCL post an annualized profit for 2022-23. However, HPCL was in the red.

This fiscal year, things have changed dramatically. The three firms posted record earnings in the first two quarters (April-June and July-September) when international oil prices, against which domestic rates are benchmarked, almost halved to USD 72 a barrel from a year ago.

International prices rose again in the subsequent quarter to USD 90, leading to moderation of their earnings. But, on a yearly basis, they had rich profits. According to IOC's regulatory filing, in the first nine months of the current fiscal (April-December 2023), the company posted a standalone net profit of Rs 347.81 billion.

State-owned fuel retailers Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation reported a bumper profit totalling over Rs 690 billion in the first nine months of the current fiscal, exceeding their annual earnings in pre-oil crisis years. The combined net profit of IOC, BPCL, and HPCL in April-December FY24 surpassed their annual earnings of Rs 393.56 billion in the pre-oil crisis year. The retailers have resisted calls to revert to daily price revision and pass on the softening in rates to consumers. They argue that prices continue to be extremely volatile, rising on one day and falling on the other, and that their past losses have not been fully recouped. The three companies, which control roughly 90 percent of India's fuel market, have 'voluntarily' refrained from changing petrol, diesel, and cooking gas (LPG) prices for almost two years now, resulting in losses when input costs were higher and profits when raw material prices were lower. During April-September 2022, they posted a combined net loss of Rs 212.01 billion despite accounting for a Rs 220 billion announced but not paid LPG subsidy for the previous two years. Subsequent softening of international prices and the government giving out LPG subsidy helped IOC and BPCL post an annualized profit for 2022-23. However, HPCL was in the red. This fiscal year, things have changed dramatically. The three firms posted record earnings in the first two quarters (April-June and July-September) when international oil prices, against which domestic rates are benchmarked, almost halved to USD 72 a barrel from a year ago. International prices rose again in the subsequent quarter to USD 90, leading to moderation of their earnings. But, on a yearly basis, they had rich profits. According to IOC's regulatory filing, in the first nine months of the current fiscal (April-December 2023), the company posted a standalone net profit of Rs 347.81 billion.

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