Oil bonds save the day for IOC

ROBUST Q4 EARNINGS

A government grant of Rs 6,571.44 crore in the form of oil bonds received in March 2006 has helped Indian Oil Corporation post a net profit of Rs 4,030.57 crore in the fourth quarter of 2005-06, a rise of 351 per cent over the net profit of Rs 892.92 crore recorded in the corresponding quarter of the last fiscal.

Its net sales in the quarter under review rose by 15.6 per cent to Rs 43,788.45 crore, up from Rs 37,875.84 crore in the last fiscal.

The company's board has recommended a dividend of Rs 12.50 per equity share.

For the complete 2005-06 fiscal, IOC recorded a net profit of Rs 4,915.12 crore, marginally higher than the previous fiscal's Rs 4,891.38 crore.

In the financial year, net sales rose 21.06 per cent to Rs 1,65,813.03 crore as compared to the previous fiscal's Rs 1,36,956.74 crore.

If the special oil bonds and refiners' discount are taken away, IOC's net under-realisation in 2005-06 was Rs 14,011 crore, almost twice the previous fiscal's figure of Rs 7,777 crore.

India's largest oil refining company was adversely impacted last year when the government did not hike the retail prices of petroleum products in line with the firm price trend in international crude.

At present, IOC loses revenue of Rs 100 crore a day on account of selling retail products below their actual costs.