Indian Oil swings into black with record Rs 21,000-cr profit in FY21

Firm attributes remarkable to inventory gains caused by fluctuating global oil prices and rising sales of high-margin petrochemical products

State-owned oil refining and marketing company Indian Oil Corporation (IOC) posted a record consolidated net profit of Rs 21,762 crore for the fiscal year 2020-21 (FY21) against a loss of Rs 1,876 crore the year before. This is the highest annual profit ever reported by the firm.

However, total income fell to Rs 5.23 trillion during FY21, from Rs 5.78 trillion.

IOC’s management attributed the increase in profit to inventory gains, which came from fluctuations in global oil prices and rising sales of high-margin petrochemical products.

“Our refining throughput for FY21 was 62.351 million tonne (mt) and the throughput of the corporation’s countrywide pipelines network was 76.019 mt,” said IOC Chairman SM Vaidya.

IOC achieved the highest petrochemical sales of 2.5 mt in FY21, up 20 per cent. The petrochemicals segment reported a turnover of Rs 19,564 crore, 24 per cent higher than FY20. Gross refining margin, including inventory gains, was $5.64/barrel against the margin of $0.08/barrel in FY20. IOC sold 81 mt of petroleum products in the year, witnessing an annual drop of 9.7 per cent mainly due to Covid-induced lockdown.

The company’s revenue in the period fell 9 per cent to Rs 5.19 trillion. IOC’s board on Wednesday declared an interim dividend of Rs 1.50 per equity share. It also announced the board’s approval to expand the capacity of Bongaigaon refinery to 3 MTPA from 2.7 MTPA.

For the quarter ended March, IOC reported net profit of Rs 9,144 crore, against a loss of Rs 8,565 crore during Q4FY20.