IOC’s Net Profit Beats Estimates With 22% Profit Growth

India Oil Corporation Ltd. surpassed analysts' estimates in the April-June quarter with a 22 percent increase in profit aided by higher sales volumes and rising margins. Analysts had estimated a double-digit decline in the bottomline.

Net profit rose to Rs 4,549 crore from Rs 3,721 crore last quarter, the company said in an exchange filing on Thursday. The Bloomberg consensus estimate stood at Rs 3,112 crore. Analysts had expected a decline due to possible inventory losses arising out of the daily fuel price revision with came into effect from June 16.

Domestic sales increased to 20.7 million metric tonnes from 19.6 million metric tonnes in the last quarter. Exports also rose to 1.8 million metric tonnes versus 1.6 metric tonnes on a sequential basis.

Gross refining margin of the government-owned oil firm fell to $4.32 per barrel versus an estimated $5 per barrel.

Revenue increased 5 percent sequentially to Rs 1.05 lakh crore, beating the Bloomberg consensus estimate of Rs 96,403 crore. It was aided by budgetary support worth Rs 876 crore as revenue from grants.

Earnings before interest, tax, depreciation and amortisation rose 81 percent to Rs 8,000 on a quarter-on-quarter basis. However, this was on account of a low base as the company incurred a one-off tax expense in the last quarter. Consequently, other expenses fell this quarter to Rs 7,196 crore from Rs 12,054 in the March ended quarter.

EBITDA margins expanded to 7.59 percent from 4.39 percent on a sequential basis.

The stock rose as much as 6.7 percent, the highest in 10 months, to Rs 395 in the run-up to the earning announcement. It continued to trade 5.4 percent higher after the announcement.