Rupee depreciation helps offset a steep rise in fuel subsidy outgo
Helped by the sharp rupee depreciation that offset the steep subsidy bill, Oil and Natural Gas Corporation (ONGC), on Tuesday, posted more than doubling of its net profit in the March quarter at Rs.5,644 crore.
Briefing journalists here, Chairman and Managing Director Sudhir Vasudeva said the net profit in the January-March quarter rose to Rs.5,644 crore from Rs.2,791 crore a year ago. ONGC paid Rs.14,170 crore for subsidising diesel, domestic LPG and kerosene as against Rs.12,136 crore out go in Q4 in the previous fiscal.
The subsidy out go was made good by rupee depreciation from Rs.47.95 in Q4 2010-11 to Rs.50.29 to a U.S. dollar in 2011-12. Every rupee depreciation against the U.S. dollar increases ONGC's top line by about Rs.1,600 crore.
But for the subsidy outgo, ONGC profits would have been higher by over Rs.8,000 crore, he added.
Mr. Vasudeva said ONGC got $44.32 on sale of every barrel of crude oil. ONGC plans to invest Rs.121,737 crore in the XII Plan. This fiscal, it has a capex of Rs.30,432 crore. Its sales were up 22 per cent at Rs.18,976 crore.
The company paid a record Rs.44,466 crore in fuel subsidy in 2011-12, up from Rs.24,892 crore.
The net profit in 2011-12 rose 33 per cent to Rs.25,123 crore. But for the fuel subsidy outgo, the net profit should have been over Rs.50,000 crore. Sales were up 15 per cent at Rs.76,130 crore in 2011-12.
Keywords: ONGC, Q4 earnings
The Govt and the Oil Marketing companies are making a mockery of citizens innocence. The price of the petrol was increased by huge margin a few days back citing the loss of oil companies as one of the reason, and now what we see is that those companies are doubling their profit at the cost of public. The decontrolled of petrol prices should be reverted back so that these oil companies do not take the advantage. Also, I see lots of discrimination in the payments structure between the employees of Power & Oil companies and service sector like banking and insurance etc. The employees of these oil companies get around 40% more salaries than that of the Services sector with the reasons that these companies makes much more profit that those service sectors. But what the Govt does not understand is that, these companies are making profit at the cost of the public and natural resources, but most of the service sectors are providing social services to the public and not merely for profit.
I just dont understand. You increase petrol prices citing prospective losses and just after few days of price revise, you show such huge profits. Are the people being mislead ??
All of us are fools and we are made fools once again ...They rise the petrol price by Rs. 7 - Rs.8 (across India) and now they're planning to reduce the price by Rs. 2 is it? I think we need a non-corrupt regulatory body to control these so called Oil Companies from looting the poor public... Indians are hard-hit by the falling rupee which in-turn leads to Inflation, to add on top of it is the Fuel price increase... I will never again vote for Congress in my life... I will vote for a party which will bring in Lokpal, which will probe into the Black Money held outside India, which is determined to bring back the black money into India, which will form a corruption free Govt., which will make sincere efforts to stabilise the INR, which will have a strong PM, which will reduce the taxes on Petrol. I know this may sound more like a fantasy - But I'm sure this dream of many Indians will soon become a reality.
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