IOCL Stock Gains 4% Following Robust Q4 Results

Indian Oil Corporation share price witnessed a sharp surge on the bourses after announcing better-than-expected results for the quarter ending March.

The oil marketing company (OMC) saw a strong rise of over 50% in its net profit figure (year-on-year). A lower-than-anticipated tax rate boosted the bottom line, with profit after tax (PAT) coming in at Rs 72.6 billion, nearly five times higher than estimates.

IOCL's EBITDA surpassed estimates by 110%. This was largely driven by higher-than-expected gross refining margins (GRM) of $8 per barrel and solid marketing margins of Rs 5.9 per litre, as per a report by Motilal Oswal.

While Singapore's GRMs have slightly improved, the global refining outlook remains primarily weak due to rising supply and demand worries. Despite this, Indian Oil's marketing margins stay strong at over Rs10/litre even after tax hikes, as per analysts.

"Singapore’s GRM averaged $3.7 per barrel in Apr’25 (vs. $3.2 per barrel in 4QFY25). We have a bearish stance on refining for FY26-1HFY28 amid strong 2.5-3 million barrels per day net refinery capacity additions globally over CY24- 26, coupled with demand concerns stemming from rising trade tensions and the possibilities of a global macro-economic slowdown," Motilal Oswal Financial Service stated in its report.

At 11:45 am, IOCL shares were trading at Rs 142.53 price level, up by 3.39% on the National Stock Exchange. In the last 6 months, the shares have remained largely rang-bound, witnessing a marginal uptrend of around 2.64%.

Oil Price Levels in Mayhem

So far this year, oil prices have been in a complete mayhem. Just last week, crude oil witnessed its worst monthly price decline since November 2021. This was largely owing to escalating concerns over macro turbulence and a subdued demand outlook. The West Texas Intermediate (WTI index) futures dropped to $58.21 a barrel this week. In the April month alone, the WTI crude oil prices plummeted around 16%. Meanwhile, Brent crude has witnessed an even steeper drop of 17%.

While this might bode well for Indian OMCs, domestic refineries might experience the pinch. On a year-to-date basis, the Nifty oil and gas index has surged over 4.69%.