New Delhi: Indian Oil Corporation (IOC) reported a standalone net loss of Rs 2,661 crore for the first quarter of FY2026-27, a swing from a net profit of Rs 5,689 crore a year earlier, as the West Asia conflict pushed up crude oil costs while state fuel retailers held down retail prices of petrol, diesel, LPG and ATF even as international product prices rose, absorbing the difference through the quarter. The company attributed the fall to the same cause: it said the "decrease in profitability is mainly on account of rise in crude cost due to West Asia conflict."
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The loss came despite record throughput and higher revenue, underlining that the squeeze was on margins, not volumes. Standalone revenue from operations rose 26 percent year-on-year to Rs 2,75,972 crore, from Rs 2,18,608 crore. But the company reported a pre-tax loss of Rs 3,274 crore against a Profit before Tax (PBT) of Rs 7,405 crore a year earlier, and its standalone operating margin turned negative at −0.74 percent, from 4.01 percent a year earlier.
The mechanics visible in the accounts point to a classic oil-marketing squeeze. IOC's cost of materials consumed rose to Rs 1,71,136 crore from Rs 96,661 crore a year earlier, and purchases of stock-in-trade also rose — even as revenue grew more slowly in proportion. With pump prices of petrol and diesel, and administered LPG and ATF prices, not moving up in step with costlier crude and higher international product prices, the gap was borne by the retailer. IOC's petroleum products segment swung to a segment loss before interest and tax of Rs 2,873 crore, from a profit of Rs 9,138 crore a year earlier — the entire swing in the company's fortunes for the quarter.
This is the same pattern seen at BPCL and HPCL for the quarter: oil marketing companies posting weak or loss-making refining-and-marketing results as the crisis lifted crude while retail prices were held.
The company's own highlights were operational, not financial. IOC reported its "highest ever Q1 crude throughput" of 19.165 million metric tonnes (MMT), up 3 percent year-on-year, at 109.4 percent capacity utilisation, and its "highest-ever quarterly pipelines throughput" of 28.548 MMT, up 9 percent. It also flagged its "lowest-ever quarterly Fuel & Loss of 8.04 percent post BS-VI scenario" and record quarterly sales of petrol (4.522 MMT) and diesel (10.866 MMT). Domestic product sales, however, were roughly flat, at 25.252 MMT against 24.973 MMT a year earlier, and total sales volume eased to 26.211 MMT from 26.328 MMT. The company said its domestic market share rose 1.6 percentage points, to 43.1 percent from 41.5 percent.
Two segments ran counter to the headline. Petrochemicals swung to a segment profit of Rs 217 crore from a near-breakeven loss of Rs 1 crore a year earlier, which IOC attributed to higher sales of LAB, BA, PTA and butadiene, partly offset by weaker polymers, glycols and benzene. The gas segment's profit rose to Rs 526 crore from Rs 50 crore, on an 11 percent rise in gas sales volume to 1.873 MMT. Both, however, were far too small to offset the Rs 2,873 crore petroleum-segment loss.
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On a consolidated basis, IOC reported a net loss attributable to owners of Rs 1,631 crore, against a profit of Rs 6,814 crore a year earlier. The narrower consolidated loss, versus the wider standalone loss, reflects contributions from subsidiaries and a Rs 697 crore share of profit from associates and joint ventures, which was down from Rs 1,148 crore a year earlier. Consolidated revenue rose about 27 percent year-on-year to Rs 2,81,933 crore. Consolidated PBT was a loss of Rs 933 crore, against a profit of Rs 8,750 crore a year earlier.
Against the preceding quarter, the deterioration is starker still, because Q4 FY26 was strong. Standalone net swung from a Rs 11,378 crore profit in Q4 to the Rs 2,661 crore loss; PBT from a Rs 15,322 crore profit to a Rs 3,274 crore loss. Revenue rose about 18 percent sequentially even as the company moved from large profit to loss, again pointing to margins, not activity, as the driver. Consolidated net swung from a Rs 14,458 crore profit to the Rs 1,631 crore loss.
The results carry one significant support item. Under a government scheme, IOC recognised Rs 3,621.51 crore as revenue during the quarter towards LPG under-recoveries, part of a Rs 14,486 crore compensation the government approved in October 2025, disbursed in 12 monthly instalments. Even with this cushion in revenue, IOC still posted a loss. The PSU disclosed a cumulative net negative LPG buffer of Rs 29,729.95 crore as on June 30, indicating the under-recovery on cooking gas remains large.
IOC did not declare any dividend alongside the Q1 results. Standalone earnings per share was −Rs 1.93, against Rs 4.13 a year earlier. The standalone debt-equity ratio rose to 0.71 from 0.66 a year earlier and 0.54 at end-March, and net worth fell to Rs 1,98,067 crore from Rs 2,04,544 crore at end-March, the loss eroding reserves.
The loss deepened below the line. Total comprehensive loss was Rs 6,477 crore standalone, worse than the Rs 2,661 crore net loss, because a mark-to-market hit of Rs 4,795 crore (before tax) on equity investments that will not be reclassified to profit ran through other comprehensive income. There is no default on borrowings, and the non-convertible debentures are unsecured.
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