Oil marketing PSUs like Indian Oil, Bharat Petroleum, Hindustan Petroleum and IBP have all declared a net loss for the first quarter. Apart from the financial travails, the companies have also lost market share to new entrants in the oil retail business. HPCL was the worst hit amongst marketing companies, recording a net loss of Rs 508 crore, against a profit of Rs 262 crore in the first quarter last year. HPCLs debt has increased from Rs 1,700 crore last year to almost Rs 2,200 crore on account of higher working capital requirements, say company sources. BPCL recorded net loss of Rs 431crore for the first quarter against a profit of Rs 225 crore in the first quarter of FY05.
For most other refining companies, the first quarter margins were better than or similar to the Q1 margins last year. IOC was shielded to some extent by the high refining capacity. Despite higher subsidy losses, the net loss was Rs 54 crore, much lower than other companies. The total under recovery on account of subsidies was Rs 3,194 crore for Indian Oil.