Mirroring the troubled times confronting domestic oil marketing companies in the wake of spiraling crude oil prices, state-run Hindustan Petroleum Corporation Ltd (HPCL) on Thursday registered a 30 per cent dip in net profit for the last quarter of the financial year ended March 31, 2008. The company's net profit in the quarter stood at Rs 384.5 crore against Rs 549.5 crore a year ago, even as its total income for the quarter grew by 44 per cent to Rs 31,788 crore.
The company's last quarter results were imparted with some level of respectability due to adding back of the provisional taxation amount of Rs 409 crore. The profit before tax was in the negative at Rs 19.6 crore for the quarter against Rs 882.4 crore for the same period last year.
With government still undecided on oil prices in the country, HPCL said it was incurring under-recoveries to the tune of Rs 120 crore every day. "Our under recoveries for the 2007-08 amounted to Rs 3,119 crore as against Rs 772 crore in the previous year," said Arun Balakrishnan, chairman and managing director, HPCL. "This has resulted in a higher interest cost at Rs 792 crore on account of higher borrowing to finance our working capital requirement."
The company's net profit for 2007-08 declined by 27.8 per cent to Rs 1,135 crore from Rs 1,571 crore last year. Its turnover increased by 13.5 per cent to Rs 1,03,837 crore over Rs 91,448 crore last year.
With margins under pressure the company said it would be reviewing imports next week and it was hopeful that prices would be increased soon. "We are not rationing oil supplies right now but that does not mean we will not do so in future," Balakrishnan said.