State-run Bharat Petroleum Corporation Ltd (BPCL) on Tuesday posted a net profit of Rs 614.12 crore for the quarter ended June 30 of FY 09-10 as against a net loss of Rs 1066.70 crore for the same quarter a year ago. Sales also plunged 33% to Rs 26195.60 crore as against Rs 39297.70 crore. Shares of the company surged 2.75% to close at Rs 462.80 on the Bombay Stock Exchange on Tuesday.
On July 1, 2009, the government had announced a price hike of Rs 4 per litre and Rs 2 per litre for petrol and diesel, respectively, in an attempt to decrease the impact of the losses suffered by oil marketing companies as a result of the sharp recovery in crude oil prices. Although the price hikes attempted by the government might not fully cover the losses of fuel retailers, who were losing around Rs 6 per litre on petrol and Rs 3.6 per litre on diesel, they have substantially reduced the under-recovery burden of oil companies to manageable levels in the medium term.
Recently, state-run Oil India Ltd and BPCL have inked an agreement for a proposed joint venture for mutual co-operation in the area of development of natural gas-based business in India and overseas.
In March this year, BPCL sold oil bonds worth Rs 95 crore under the Reserve Bank’s Special Market Operation Scheme to fund its purchase of crude oil. The oil marketing company spends about Rs 1,000 crore every month to purchase crude oil. BPCL purchases crude from domestic explorers like state-run Oil and Natural Gas Corp’s Mumbai High fields, as well as imports the feedstock for its refineries.
The company’s principal activities are to refine, store, market and distribute petroleum products. It offers petrol, diesel, aviation fuel, liquefied petroleum gas (LPG) and lubricants. The oil marketing company retails LPG under the ‘Bharatgas’ brand name, as well as supplies LPG through a pipeline network. It also offers various industrial services like customer advisory services, energy audits, e-banking, consultancy and technical services, fuel management system, etc . As on March 31, 2008, its marketing network consisted of 22 aviation service stations, 8,251 retail outlets and 2,137 LPG distributors.