Indian Oil's Q1 profit plunges 81% on lower marketing margins
Indian Oil Corp (IOC) reported a nearly 81% plunge in first-quarter profit on Tuesday, weighed by lower marketing margins.
The state-owned firm's standalone net profit declined to 26.43 billion rupees (around $316 million) for the three months ended June 30.
IOC's average gross refining margin - the profit from making refined products from one barrel of oil - fell to $6.39 per barrel from $8.34 per barrel a year ago.
KEY CONTEXT
Fuel consumption remained strong in the quarter as robust industrial activity and general elections-related activity boosted demand in Asia's third-largest economy.
However, higher prices of crude oil - a key raw material for refiners - remained a cause for concern, with rival state-owned refiners such as Hindustan Petroleum and Bharat Petroleum reporting a hit in their bottomlines in the quarter due to lower refining margins.
India is the world's third-biggest oil importer and consumer. Indian Oil, along with its unit Chennai Petroleum, controls about a third of India's five million-barrels-per-day refining capacity.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 Analysts' sentiment
months) months)
RIC PE EV/EBITDA Revenue Profit Mean No. of Stock to Div
growth (%) growth rating* analyst price yield
(%) s target** (%)
IOC 10.31 7.32 1.42 -39.79 Hold 20 1.11 6.80
Bharat Petroleum 9.94 7.38 -- -- Hold 22 1.01 6.39
Corp Ltd (BPCL)
Hindustan Petroleum 7.94 7.14 -- -- Hold 15 1.09 7.04
Corp Ltd (HPCL)
Reliance Industries 24.60 12.26 9.61 12.87 Buy 31 0.92 0.30
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell ** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the PT
APRIL-JUNE STOCK PERFORMANCE
-- All data from LSEG IBES
-- $1 = 83.7200 Indian rupees
