State-owned Indian Oil Corp (IOC), on Friday, reported a 16 per cent drop in its fourth quarter net profit to Rs 5,556.77 crore as it was not fully compensated for selling fuel below cost. Net profit fell from Rs 6,622.96 crore in the corresponding period of the previous year, the company said in a filing to the Bombay Stock Exchange (BSE).
Sales, or income from operations, rose 24.8 per cent to Rs 66,116.20 crore. Similar to its sister state fuel retailers, IOC sells petrol, diesel, domestic LPG and kerosene below cost on the government's orders to keep inflation under check.
While its Rs 7,548.29 crore revenue loss on selling petrol and diesel below cost in 2009-10 was fully made up, the loss on domestic LPG and kerosene was only partly compensated. It got Rs 15,171.84 crore for LPG and kerosene, Rs 3,158.81 crore less than total loss it incurred on selling cooking fuels at subsidised rates. IOC's net profit jumped to Rs 10,220.55 crore for the entire 2009-10 fiscal. Sales, however, dipped 5.1 per cent to Rs 249,271.35 crore.