Indian Oil Corp reports Q2 net loss of Rs 329 crore

New Delhi: Indian Oil Corp, the nation's biggest company, Tuesday reported net loss of Rs 329 crore in the September quarter on account of huge inventory and foreign exchange losses as well as low refining margins.

IOC has made net loss of Rs 329.17 crore in the July- September quarter of the current fiscal, compared to net loss of Rs 898.46 crore in the same period a year ago, the company chairman B Ashok told reporters here.

"On physical parameters we have done extremely well. On sales we have done well. Capacity utilisation has been good. What has impacted is inventory losses," he said.

The company lost Rs 5,137 crore on inventory as it bought crude at one price but sold at lower rates as prices had fallen during the period oil was transported, processed and turned into fuel. This compares to Rs 4,272 crore inventory loss in the same period a year ago, he said.

Also, there was a foreign exchange loss of Rs 1,100 crore in the second quarter of 2015-16 as opposed to Rs 672 crore loss in the same period of 2014-15.

IOC earned just 90 cents on turning every barrel of crude oil into fuel as compared to a negative gross refining margin of USD 1.95 per barrel.

Without the inventory loss, the GRM in the second quarter of the current fiscal should have been USD 6.92 per barrel as opposed to USD 3.25 last year.

Fall in oil price led to a drop in turnover to Rs 85,384.81 crore in the period under review, as compared to Rs 1,11,663.81 crore a year ago.

Ashok said all of its loses on sale of PDS kerosene and domestic LPG at government controlled rates were made good. The government gave a cash subsidy of Rs 1,715 crore and another Rs 462 crore was received as dole from upstream firms like ONGC.

Refinery throughput increased to 13.683 million tons during the quarter from 13.407 million tons a year ago. Pipeline throughput was also up at 19.982 million tons as against 19.039 million tons. Sales were up 6 percent at 18.15 million tons, he said.

Finance cost was lower at Rs 729 crore in the quarter under review as against Rs 1,039 crore in the same period a year ago.