IBP set to post losses despite oil bonds
IBP was certain to post losses in 2004-05. However, this could be averted as the Govt had paid past dues of the OCC to the company.india Updated: Mar 16, 2006 11:46 IST
Indian Oil Corporation subsidiary IBP & Co Limited, the standalone oil marketing PSU, is all set to post losses during the current financial year despite the government issuing oil bonds amounting to Rs 400 crore to the company.
A high-level IBP official told PTI that Rs 400 crore oil bonds had been given to the company on account of subsidy on LPG and kerosene. However, he said that the company was still suffering from under-recovery in diesel and motor spirit.
Till December 2005, the company had posted accumulated losses to the tune of Rs 500 crore, the official said. Going by this trend, IBP is all set to post loss again in the last quarter, he added.
According to the official, Rs 400 crore worth oil bonds would not be sufficient to offset the losses during the four quarters of 2005-06.
IBP was certain to post losses in 2004-05. However, this could be averted as the government had paid past dues of the Oil Coordination Committee (OCC) to the company.
The official said that this would be the first time that IBP would be in the red.
According to the official, IBP may not come up with a separate P/L statement for 2006-07 since the merger with its parent company is slated to be completed by April or May 2006.
The official said that since the merger process would be completed during 2006-07, the department of company affairs (DCA), with whom the issue was pending, might choose to declare that the amalgamation be effective from April one, 2005.
In that case, publishing a separate P/L statement by IBP for 2005-06 was not required.
The official said that despite the company posting losses, IBP's capital expenditure plans would be completed as announced.
The company planned to spend Rs 500 crore for increasing the number of retail outlets, modernisation and upgradation.
Meanwhile, the proposed transfer of IBP's LPG division would be done in April, the official said.
The share swap of IBP-IndianOil merger had been changed from 100:125 to 100:110.