Indian Oil Corporation Ltd (IOCL) Ltd reported a 31.4 percent decline in the fourth quarter of 2021-22 (Q4FY22) to Rs 6,022 crore even as the company reported the highest ever net profit in the year ended March.
The state-run oil marketing company reported revenue of Rs 2,06,461 crore during the quarter under review, as compared to Rs 1,63,733 crore logged in the corresponding quarter of the previous financial year. For the year 2021-22, the company reported a record high revenue of Rs 728,460 crore as against Rs 5,14,890 crore in the previous financial year, riding high on the surge in crude oil prices.
The fourth quarter's bottomline was dented by a margin squeeze in petrochemicals and a loss in auto fuel sales. For the most part of this quarter, IOCL, and other state-run oil marketing companies, left the price of auto fuel unchanged despite the benchmark crude oil prices soaring to a 14-year high of $140 a barrel in early March. While prices of fuel sold to bulk consumers and aviation turbine fuel were raised, retail prices of petrol and diesel were left unchanged for almost 137 days. The OMCs resumed increasing the prices only from March 22.
IOC’s pre-tax earnings from the sale of petroleum products declined by 8 percent to Rs 8,251.29 crore in the March quarter, while that for its petrochemicals business fell 72 percent to Rs 570.18 crore. This was despite an increase in revenue from petroleum products to Rs 197, 724.49 crore in Q4FY22 from Rs 157,109.11 crore a year ago, and an increase in petrochemical revenue to Rs 8,009.59 crore, from Rs 6,382.61 a year ago.
The company reported a robust refining margin in the quarter but the impact was offset by a narrowing of margin in petrochemicals and a loss in auto fuel sales.
The average gross refining margin (GRM) for the year FY22 stood at $11.25 per barrel (bbl) as against $5.64 per bbl a year ago. The core GRM or the current price GRM for FY22 after offsetting the impact of inventory gain stands at $7.61 per bbl. GRM is the margin that refiners earn from turning each barrel of crude oil into fuel products.
In the fourth quarter of FY22, IOCL’s product sales volumes, including exports, were 23.310 million tonnes, refining throughput was 18.265 million tonnes and the throughput of the pipeline network was 22.061 million tonnes.
For the year 2021-22, IOCL sold 86.407 million tonnes of products, including exports. The refining throughput in the fiscal was 67.665 million tonnes and the throughput of the company’s countrywide pipelines network was 83.248 million tonnes in the period.
Separately, the company announced the issue of bonus shares in the ratio of one equity share of Rs 10 each for every two equity shares held in the company.