IOC loss widens to 3,719 cr
Mumbai   11-Aug-2011

State-owned IndianOil (IOC) reported higher net loss in the first quarter ended June 30 to Rs 3,719 crore as the government made good only a third of the losses it made on selling auto and cooking fuel at state controlled rates.

IOC, the nation's largest oil firm, had reported a net loss of Rs 3,388 crore in the April- June quarter of 2010- 11, company Chairman R S Butola told reporters in New Delhi.

The Rs 15,000- crore share sale of the oil major has been deferred till this yearend due to unfavourable market conditions and rising global crude oil prices.

IOC earned USD 4.71 on turning every barrel of crude oil into petroleum products in the April- June quarter as opposed to a gross refining margin of USD 3 per barrel an year ago. Turnover rose about 28 per cent to Rs 99,757 crore in Q1.

"Major reason (for widening of net loss) has been that we have had a higher number of unmet under-realisation on diesel, domestic LPG and kerosene," he said.

IOC lost Rs 23,806 crore on selling diesel, domestic LPG and kerosene at government controlled rates in Q1.

Against this it got Rs 7,932 crore by way of upstream assistance and another Rs 8,201 crore from the government.

The unmet fuel loss in Q1 increased to Rs 7,673 crore from Rs 7,343 crore in the same period a year ago, Butola said.

Also, the company had to pay Rs 467 crore more in Q1 on account of higher interest on its borrowings.

Besides, IOC had an inventory loss of Rs 900 crore. The company had crude inventory when the government on June 26 cut customs or import duty to zero from 5 per cent, leading to the loss in revaluation, he said.

"Larger reason for the Q1 loss is the unmet revenue loss on fuel sales and increase in interest outgo," he added. IndianOil said state-owned oil firms are making a small margin of Rs 0.30 per litre on petrol but a reduction in retail price will be possible only if international rates come down on a sustained basis.