India’s three state-owned oil marketing companies — Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) — reported a combined standalone net profit of ₹30,106 crore in the July-September quarter of FY27.
The combined profit rose 68.3% year-on-year from ₹17,884 crore in the corresponding quarter last year. It also marked a sharp recovery from the combined loss of around ₹18,150 crore reported in the April-June quarter.
The September-quarter earnings alone accounted for nearly 39% of the three companies’ combined FY26 profit of ₹77,281 crore.
IOC leads the profit surge
IOC accounted for the bulk of the earnings, reporting its highest-ever quarterly standalone net profit of ₹21,630 crore. This was nearly three times its profit of ₹7,610 crore in the year-ago quarter.
The company’s performance was supported by improved refining margins, inventory gains and strong contributions from its petrochemical and gas businesses.
BPCL, however, reported a 22.5% year-on-year decline in standalone net profit to ₹4,993 crore, compared with ₹6,443 crore in the corresponding quarter last year.
HPCL’s net profit fell 9.1% to ₹3,483 crore from ₹3,830 crore.
Refining margins drive earnings
Higher gross refining margins (GRMs), which measure the earnings from processing crude oil into petroleum products, supported the recovery.
HPCL’s GRM increased to $32.15 per barrel in Q2 FY27, compared with $8.80 per barrel in the same quarter last year. BPCL’s GRM rose to $32.53 per barrel from $10.78.
IOC also benefited from a temporary decline in crude oil prices between mid-June and mid-August. This lowered its input costs and generated inventory gains estimated at around ₹7,000 crore.
LPG subsidy burden and fuel price pressure
The strong quarterly earnings came despite continued pressure on fuel marketing operations. Petrol and diesel retail prices remained unchanged since May, while domestic LPG prices were held steady despite higher international prices.
The three companies had accumulated combined fuel under-recoveries of ₹67,900 crore by the end of September due to the gap between fuel costs and selling prices, including unpaid LPG subsidy amounts.
IOC reported under-recoveries of ₹32,505.69 crore, while BPCL and HPCL reported ₹17,334.40 crore and ₹18,048.82 crore, respectively.
IOC has also cautioned that profitability in the coming quarters could face pressure from potential inventory losses if crude oil prices decline as the West Asian situation normalises.
The Q2 performance highlights the impact of refining margins and inventory movements on the profitability of India’s state-run oil companies, even as their fuel retail businesses continue to face pricing and subsidy-related challenges.
