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Informist, Friday, Feb. 7, 2025

By Alina Geogy

MUMBAI – Oil India Ltd.'s net profit and revenue for the December quarter fell more than the Street's expectations due to a decline in sales of crude oil and natural gas. The public sector undertaking's net profit fell nearly 23% on year in the December quarter, making it the fourth year-on-year decline in the last six quarters. This is the highest on-year fall in the December quarter net profit since 2019 when it fell 67%.

Oil India reported a net profit of INR 12.22 billion in the December quarter, sharply lower than analysts' estimate of INR 15.44 billion. The company's revenue in the December quarter fell nearly 10% on year to INR 52.40 billion, missing the analysts' estimate of INR 53.39 billion. The revenue from crude oil fell to INR 36.58 billion from INR 42.13 billion a year ago and sales of natural gas fell to INR 13.82 billion from INR 14.10 billion a year ago. These two segments account for more than 95% of the company's total revenue.

The decline in sales comes despite an increase in crude oil and natural gas production for the quarter. Crude oil production rose to 868,000 tonnes from 856,000 tonnes a year ago, while natural gas output rose to 0.829 billion cubic metres from 0.822 billion cubic metres a year ago. Realisations on crude oil prices for the December quarter fell to $73.82 per barrel from $84.14 per barrel.

In the nine months ended December, Oil India's net profit rose to INR 45.23 billion from INR 35.23 billion a year ago. Its revenue in Apr-Dec rose to INR 165.98 billion from INR 163.73 billion a year ago.

Oil India's operating margin expanded to 30.65% in the December quarter from 27.63% a year ago. The company's board announced an interim dividend of INR 7 per share.

The company's total tax expenses for the December quarter were INR 3.28 billion, down nearly 6% on year. The total tax includes a tax of INR 2.84 billion for the current year. Oil India said it deposited a total goods and services tax amount of INR 12.54 billion till Dec. 31, on which, the company has received a refund of INR 1.24 billion in Assam. Tax authorities raised service tax demand for the period from March 2016 to June 2017 seeking to levy service tax on the royalty paid on crude oil and natural gas in Assam, Arunachal Pradesh, and Rajasthan. The company had challenged the demand on various grounds by filing writ petitions before different high courts. However, pending adjudication of the writs, the company deposited the entire service tax demand under protest, it said.

On Friday, shares of the company closed 0.1% lower at INR 424.80 on the National Stock Exchange. Oil India released its earnings for the December quarter post-market hours.  End

US$1 = INR 87.42

Edited by Saji George Titus

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