The Chennai Petroleum Corporation Ltd (CPCL), which is also a subsidiary of Indian Oil Corporation (IOC), reported a 38% increase in net profit last year. The Chennai Petroleum Corporation Limited saw an increase in net profit of Rs. 1,024 crore for the year, which ended on March 31, 2017, against last year’s net profits of Rs. 740 crore. The total revenue increased by a margin of 16 percent, leading to a rise of Rs. 40, 586 crores, compared to the previous year’s Rs. 34,953 crore.
The 38% percent jump in improved profits was reflective of the petroleum corporation’s capacity to derive better margins from the projects and contracts undertaken. The jump was the second highest net profit that the corporation has ever reported in a fiscal year. The previous increase of this variety was recorded in the 2007-08 fiscal year.
The board suggested a dividend of 210%, which would equal Rs. 21 per equity share as stated in a report by the Hindu Business Line. This percentage is also the highest that has ever been announced by the organization. The IOC chairman B Ashok was proud of his team, mentioning that the oil giant had been making steady improvements through the years. It was not until 2014 that the group started to notice a real change after the CPCL started regularly reporting to the Board for Industrial & Financial Reconstruction.
The IOC chairman credited the improved financial performance to an increase in profits as a result of increased product sales. The physical performance of the staff members and employees also helped the corporation but it was a favorable turn in price for international crude and crude oil products that really shook things up financially. The merger of CPCL with IOC also led to integration and increased the diversity of projects. The end result was a higher gross refining margin of $6.05 a barrel in the session 2016-17 against $5.27 a barrel, which was the standard price the year before.
The Chennai Petroleum Corporation Ltd managed to exceed the MoU target of 10.25 million tonnes, which was to be achieved in the next seven years. Furthermore, CPCL attained a throughput of 10.25 million tones despite the effects of cyclone Vardah.
To further business, the Managing Director of CPCL Gautam Roy stated that approximately Rs. 5,200 crore would be re-directed and utilized on a number of projects including the construction of a new crude oil pipeline from Chennai port to the refinery and the completion of the Resid Upgradation Project.