Oil marketing lower profit : IOC Q4 show leaves brokerages mixed as weak refining margin drags EBITDA

Oil marketing lower profit

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The oil marketing company’s lower profit in March quarter comes as crude oil prices rose 16% in the first three months of 2024

Oil major Indian Oil Corporation Ltd’s fourth quarterly show came below expectations as consolidated net profit slipped 49 percent.Oil marketing lower profit

The state-run oil retailer reported a net profit of Rs 5,487.92 crore for fourth quarter of financial year 2023-24 as against a profit of Rs 10,841.23 crore in the same period last year.

Lower profit by the oil marketing company comes as crude oil prices rose 16 percent in the first three months of 2024. Oil marketing lower profit

Also Read | Indian Oil Q4 net profit falls 49% to Rs 5,488 crore

Emkay Global said that EBITDA missed its estimates by 27 percent at Rs 10,750 crore for the quarter due to weaker refining on the back of inventory losses. The gross refining margin also came in at $10.6/bbl as compared to Emkay’s estimates of $13/bbl. marketing lower profit

According to Nuvama Institutional Equities, the chemical sector remained soft on weak realisations, which were offset by higher sales volumes. marketing lower profit

The chemical sales volumes grew 21 percent on-year to 81 TMT (thousand metric tonnes). However, the weak realisation led to a negative chemical EBIT of Rs 400 crore. marketing lower profit

IOC saw largely flat domestic retail volumes at 21 MMT (million metric tonnes), but diesel sales fell five percent on-year while petrol sales grew 6 percent. The retail margins for diesel doubled to Rs 4 per litre amid weak crude prices. marketing lower profit

“Post-election cycle, we expect OMCs’ marketing business to improve as price action resumes, supporting healthy margins,” said Emkay. The brokerage increased its target price on the player to Rs 180 per share, retaining its add call. marketing lower profit

However, Nuvama Institutional Equities maintained its reduce rating, with an unchanged price target of Rs 151 apiece. marketing lower profit

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