HPCL makes Rs 248 cr Q3 profit
New Delhi: Hindustan Petroleum Corp Ltd (HPCL) Tuesday reported an 87 per cent drop in net profit to Rs 248 crore in the December 2018 quarter, owing to inventory losses and lower refinery margins.
It had posted a net profit of Rs 1,950 crore in the corresponding period a year ago, HPCL Chairman and Managing Director Mukesh K Surana told reporters here.
"The decrease in profit is mainly due to inventory losses caused by falling crude oil prices and higher fuel and loss component," he said. Inventory loss occurs when a company buys raw material (crude oil) at a particular price but by the time it is able to process it and convert it into fuel?, the rates have fallen. Inventory gains occur when the opposite happens. Surana said the company lost Rs 3,465 crore because of inventory losses during the third quarter, compared with an inventory gain of Rs 1,477 crore a year ago.