State-run Oil and Natural Gas Corp, India's largest crude-oil producer, said Monday fourth-quarter profit fell 13.1 percent from a year earlier, hit by discounted sales to domestic refiners.
Profit fell to 26.81 billion rupees (661.3 million dollars) in the quarter ended March 31, from 30.86 billion rupees a year earlier, ONGC said in a statement to the Bombay Stock Exchange.
Sales rose to 145.76 billion rupees in the period, from 125.28 billion rupees a year earlier. Earnings were hurt by discounts offered to domestic refiners, part of a government attempt to ease prices at the pump and lower inflation. The Indian government and its oil arms subsidise sales of petroleum products that have a heavy weighting in the inflation gauge.
The company sold crude oil to domestic refiners at an average 44 dollars a barrel, a 22-dollar discount, ONGC chairman R.S. Sharma said. For the full year to March 31, profit still rose 8.4 percent to 156.43 billion rupees, from 144.31 billion rupees in the previous fiscal year, ONGC said.
Full-year sales rose 18 percent to 569.04 billion rupees in the year, the company statement said. Sharma said the state-run firm and its subsidiaries planned to invest a massive 1.21 trillion rupees in 2007-2012, the Press Trust of India reported. That compares with an investment of 753.8 billion rupees in the previous five years.
India is trying to raise production by tapping new sources of oil and gas at home and abroad to reduce its dependence on imports that account for two-thirds of consumption and combat volatile oil prices.
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