← Throughline · holding view Deep analysis ↗ Q1 FY26
IOC Indian Oil Corporation · Other Q1 FY26 · concall
Pattern: buyback lpg accounting

US-Iran conflict reshapes the narrative in Q4FY26: GRM disclosure paused, LPG losses surged to Rs.

1 deflection · 1 weak · 2 clean — pushback across 2 of 4 Q&A turns

Focused evidence 2 of 4

Sumeet Rohra · Smartsun Capitaldeflection

Market cap is only Rs. 2 lakh crore vs asset base of Rs. 5.5 lakh crore. Can management consider a buyback to boost EPS and send a confidence signal?

Point noted, sir. Thank you. On LPG, we are awaiting the final modalities from MOPNG. As per Union Cabinet, INR30,000 crores approved. Out of INR41,000 crores claimed, got INR30,000 crores — this is a good sign for continued government support. In next 1 year, all projects getting commissioned and income starts coming in books of accounts — that should give a big comfort.

Achal Shah · Ambit Capitalweak

Aviation business market share and margins? Throughput per outlet vs BPC? LPG under-recovery per cylinder in Q1 FY26 and current?

Aviation market share is between 55% to 60%. We don't share per-product margins separately — we maintain integrated GRM. We are very bullish on aviation business. Per pump throughput is around 130 KL per month. Project Sprint is targeting increasing throughput per outlet through middle-selling outlets and low-selling outlets. LPG under-recovery in Q1 FY26 was around INR160 to INR165 per cylinder. Today, it is in the range of INR100 to INR105 per cylinder.

▸ Other Q&A (2)
Probal Sen · ICICI Securities

How much Russian crude in Q1 and what discounts? What was the inventory impact? And what are the timelines for the 9% to 12.5% energy basket share and 6% to 15% petchem intensity targets?

In Q1, Russian crude increased to 24%. Discount is in the range of around $1.50 to the Dubai benchmark. This quarter, we had an inventory loss of almost INR6,500 crores, whereas Q4 last year we had a gain of almost INR3,500 crores. The 12.5% energy basket target is by 2050. The petchem intensity 6% to 15% target should be achieved by 2030 plus or minus 1 or 2 years. We have also announced a big investment of almost USD 8-10 billion in the dual-feed naphtha cracker at Paradip Refinery. Peak debt-to-equity target is within 1:1.

S. Ramesh · Nirmal Bang Equities

Breakup of inventory loss between refining and marketing. Gas business — revenue was similar Y-o-Y but profit crashed. What happened?

Inventory loss breakup is approximately 50-50 between crude and product side. Total inventory loss is INR6,500 crores. For gas business, gas is one of the most profitable businesses for Indian Oil. The margins internationally have been high for LNG in the past quarter, which affected profitability. LNG industrial use margins have come down because of high pricing in international market. CGD segment is becoming stronger day by day but not giving huge profit or negative as yet.

▸ Prepared remarks (5 blocks)
Thank you. Dear investors and analysts, a very good morning to all of you. I take this opportunity to welcome all of you to the conference call organized by us post announcement of the first quarter results of financial year '25-'26. This quarter, we have registered a profit after tax of INR<strong>5,689 crore</strong>, which was INR7,265 crores in the preceding quarter and INR2,643 crores in the corresponding quarter of financial year '25. The decline from the last quarter was primarily on account of inventory losses, which we are going to discuss further. Revenue from operations during this quarter stood at INR218,608 crores. In August 2025, the Union Cabinet has approved compensation amounting to INR30,000 crores to the 3 public sector oil marketing companies for the under-recoveries incurred on sale of domestic LPG. We are yet to receive an official communication in this regard for further details and accounting. I'm pleased to share our operational performance this quarter has been robust surpassing several key benchmarks of previous quarters. Our sales for the quarter were highest ever and many other operational achievements were made.
The past quarter has witnessed important developments, both globally and domestically. On the interest rate front, the U.S. Federal Reserve has maintained the federal fund rate in the range of <strong>4.25%</strong> to 4.5% through July 2025. In India, the Reserve Bank of India reduced a benchmark repo rate to 5.5% in May 2025, representing a cumulative cut of 500 basis points over the last 6 months. S&P Global Ratings has upgraded India sovereign rating to BBB, underscoring the nation's strong fundamentals. The average price of crude Indian basket during this quarter witnessed a reduction of about 12.4% from the immediately preceding quarter. Both MS and HSD cracks have improved in comparison to the previous quarter. Refineries: The report GRM of $2.15 per barrel during this quarter is lower than the previous quarter, mainly due to inventory losses. However, the normalized GRM for the quarter at $6.91 per barrel is better than the previous quarter of $5.39 per barrel. Pipeline: The capacity utilization was about 74% during this quarter. Pipeline throughput during the quarter is 26.3 million metric tonnes.
During the quarter, Indian Oil achieved highest ever total quarterly sale of <strong>26.328 million</strong> metric tonnes. During the quarter, 445 retail outlets were commissioned, taking the total number close to 40,666. During financial year '25-'26, we plan to set up more than 4,000 retail outlets. Petrochemicals: The sale of petrochemical products, including exports during this quarter was 0.83 million metric tonnes.
During the quarter, we registered natural gas sales of 1,644 TMT and CGD sales of 41 TMT. We have entered into a long-term sale and purchase agreement with ADNOC for supply of <strong>1 million</strong> metric tons per annum of LNG over a 15-year period starting from '28-'29. Capex: During the quarter, the company incurred a total Capex of INR6,470 crores. For financial year '25-'26, the budgeted Capex is INR33,494 crores. Borrowings: The borrowing as on 30th June '25 has decreased by about INR13,000 crores and is at INR121,547 crores. With the current debt-to-equity ratio of 0.66 as on 30th June '25, Indian Oil is comfortably placed to fund the ongoing Capex plans.
We have begun the new fiscal year with a strong strategic thrust through the launch of Project Sprint, which is our transformational road map to not only sustain, but also accelerate our leadership in the energy sector. Sprint represents the confluence of 6 strategic pillars — strengthening the core business, cost leadership, customer centricity, cutting-edge technology and innovation, the development of the next generation of leadership and readiness for the energy transition.
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