Hindustan Petroleum Corporation Ltd (HPCL) net profit jumped 312.5 per cent in the fourth quarter for 2011-12 on higher subsidy gains.
The cash compensation from Government and upstream companies such as ONGC, GAIL and Oil India helped HPCL report profit after tax of Rs 4,630.99 crore during January-March 2012 against Rs 1,122.66 crore in the same period previous year.
The company received Rs 8,486 crore from Government and another Rs 4,000 crore from upstream companies in the fourth quarter towards compensating losses incurred on selling diesel, domestic LPG and PDS kerosene below market cost.
HPCL reported Gross Refining Margin (GRM) of $3.68 a barrel in fourth quarter down from $8.55 a barrel in the corresponding quarter last year.
In fourth quarter of 2010-11, there was inventory pile up of crude oil that resulted in higher GRM. But, in 2011-12, crude prices shot up, whereas product prices remained stagnant leading to lower GRMs.
However, in the complete financial year of 2011-12, HPCL net profit dipped to Rs 911.43 crore against Rs 1,539.01 crore in the previous year. This is due to increase in interest costs of Rs 2,139 crore because of increase in gross under-recoveries and delay in receipt of compensation.
HPCL has proposed a dividend of Rs 8.50 a share for 2011-12.