Reduction in interest costs and subsidy receipts from the Government on PDS kerosene and domestic LPG sales helped Hindustan Petroleum Corporation Ltd more than double its net profit for the second quarter of fiscal 2014-15. Its net profit during the quarter stood at ₹850 crore as against ₹319 crore in the same quarter last year.
“The company had to absorb very little under-recovery during the quarter, which was only around ₹8 crore. Of a total under-recovery of ₹5,162 crore, around ₹3,751 crore support was from discounts provided by upstream companies and the rest came from the Government,” said KV Rao, Director, Finance, HPCL.
During the quarter, HPCL’s net sales dropped by 0.4 per cent to ₹51,688.72 crore, against ₹51,903.66 crore. Rao added that HPCL does not plan to raise retail selling prices of diesel and petrol despite the excise duty hike of ₹1.5 per litre on the two fuels. “After absorbing the excise duty hike, we will have no over-recovery,” he said.
The company’s gross refinery margin (GRM) slipped to $2.12 per barrel, against $3.81 per barrel in the same quarter last year. The fall in GRM was due to the inventory loss, which, Rao said, was an outcome of crude oil prices falling over the last few months.
On Thursday, HPCL’s shares closed 6.11 per cent lower on the BSE at ₹541.80.