IOC's Q3 net seen rising 77% to Rs 5539 cr

Indian Oil Corporation (IOC) is likely to see a 77 percent jump in its net profit for December quarter at Rs 5,539 crore against Rs 3122 crore quarter-on-quarter. Analysts polled by CNBC-TV18 say IOC’s total income for Q3 is seen at Rs 97,363 crore against Rs 1,00,274 crore in the previous quarter. Earnings before interest, taxes, depreciation and amortisation (EBITDA) for the December quarter is seen at Rs 9,611 crore against Rs 5,772 crore in the previous quarter, an increase of 66.51 percent. The EBITDA margins may also rise to 10 percent from its 5.76 percent level in the previous quarter. Among other key metrics, analysts feel that inventory gains could spring a surprise in Indian Oil’s (IOC) December quarter earnings. Gross refining margin from Paradip refinery will benefit by the fourth quarter of the fiscal. This refinery now remains the key for the company, the analysts add. Weak diesel spreads and inventory losses had hit the company’s gross refining margins (GRM) in second quarter of the current fiscal. Both these factors turned around in the third quarter, which is likely to help the GRMs in the December quarter, analysts polled by the channel indicate. Gross refining margin (GRM) is the difference between total value of petroleum products and price of crude. The same quarter also saw its GRMs getting hit by negative margin from Paradip refinery. Analysts expect utilisation to improve from 50 percent to 90 percent by December 2016.