Our marketing margins have been steady at Rs 3000-cr plus: Sanjiv Singh, IndianOil
New Delhi   01-Nov-2017



Talking to ET Now, Sanjiv Singh , Chairman, Indian Oil , say sees continuous demand growth in double digits for LPG which we expect will continue for quite some time.

How has Indian Oil fared?

The second quarter results of Indian Oil Corporation have been announced and during this quarter we processed 16.096 million ton of crude which was nearly 2.9% higher than the same quarter previous year which was 15.635. The net profit after tax this quarter was Rs 3696 crore which was higher than Rs 3122 crore during the same quarter previous year.

The GRM this year was $7.98 per barrel during the second quarter which was higher than $4.32 per barrel in the same period last year.

If we discount any impact of inventory, the GRM was $9.14 this year which was again higher than $4.26 per barrel GRM of the previous year. In terms of physical performance, the refineries did extremely well in terms of throughput, distillate and energy efficiency where we did better than the same quarter last year.

The market was expecting some inventory gains on your part. Can you share the numbers?

This year we had an inventory gain of Rs 1056 crore of which nearly Rs 932 crore was on account of crude and Rs 134 crore on account of products. As the prices were going up during the last month, especially during the last fortnight, the impact will be in the next quarter. That is why the inventory gains was slightly lower than what was expected.

What has been the volume growth in terms of diesel and petrol and what is the outlook that you maintain as we go forward?

We are seeing very robust growth as far as gasoline or petrol consumption is concerned. When we compare on a quarter to quarter basis, or compare CAGR year to year, we are seeing a growth of around 9-10% for gasoline. And for diesel, we are seeing a growth of 3% plus which is again a very reasonable number considering the fact that diesel consumption in the country is nearly 3.5-4 times more than the petrol. So, for both these transportation fuel, there is a continuous growth in the demand.

How are the marketing margins panning out?

Our marketing margins are nearly Rs 3000 crore plus. It had been more or less steady of the same order what we had last year and while we had significant improvement in the refinery margins.

Given the fact that the government has launched a number of schemes such as Ujjawala, in that backdrop how has been the demand LPG on your part?Traditionally LPG demand growth had been driven by the supplies and with the penetration going up which is more than 76% today the LPG demand is also growing. We are seeing continuous demand growth in double digits for LPG which we expect will continue for quite some time.

Any expansion plans that you can tell us as we go forward?

Expansion plans for Indian Oil are all published and all known and in almost all the refineries, we are in different stages of getting the approvals for expansion plans.

Any update on the government selling 3% stake in the company through OFS? We were told last time that the disinvestment department of the government is taking IOC in confidence in each of the steps. Any update on that?

The government would be in a better position to ask this question because it is absolutely up to the government because they are the major shareholders for the company and they are the owners of the company. It is absolutely their call.

The crude at the moment is hovering around $60. Saudi Arabia has decided for a supply cut. How does that augur for IOC?

Not only IOC, if you look at the downstream industry in the country, we have been operating at $110 rate also and we managed as well as at the lower rates also.