Gail India bottomline dips 7.1% to Rs 339 crore

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Gail (India) has reported a 7.1 per cent drop in profit after tax at Rs 339 crore during April-June this year. The decrease was attributed to its Rs 226 crore share for kerosene and cooking gas subsidy. The company's turnover, excluding excise duty, rose 11.5 per cent to Rs 3,119 crore (Rs 2,798 crore). Gross margin grew 1.8 per cent.

"As against an anticipated increase in PAT to Rs 473 crore, the actual PAT dropped to Rs 339 crore only due to sharing of subsidy burden of Rs 226 crore on account of kerosene and domestic LPG, even though GAIL does not produce Kerosene," a company release said.

The company has also taken up the issue with the government since the current mechanism is at variance with the earlier mechanism of sharing of subsidy in the ratio of PAT of the previous fiscal. Gail has also taken up with the oil marketing companies not to pass on an indirect subsidy burden by not reimbursing the Central sales tax and full inland freight on LPG purchased by them for the domestic sector.

If the company's representation is considered favourably, the subsidy burden on Gail could drop from Rs 226 crore to Rs 93 crore during the first quarter, the release said.

Natural gas trading increased 16.62 per cent to Rs 1,922 crore, while interest and financing charges dropped 24 per cent to Rs 41 crore. Loans amounting to Rs 59 crore were repaid during the quarter.