State gas utility GAIL India today reported a 59.28 per cent dip in its net profit to Rs 253 crore in the third quarter ended December 31, 2008, as compared to Rs 621.32 crore in the same period last fiscal, on more than doubling of LPG subsidy payouts.
The drop was primarily due to Rs 904.95 crore payout on LPG subsidies. Of this, Rs 646.49 crore was for subsidies for the third quarter and Rs 258.46 crore to cover for short provision in the second quarter.
GAIL along with Oil and Natural Gas Corporation (ONGC) and Oil India makes up for roughly one-third of the revenue loss incurred by retailers on fuel sales by way of discounts on LPG and crude oil they sell to Indian Oil, Bharat Petroleum and Hindustan Petroleum.
The gas utility had in third quarter of previous fiscal paid Rs 367.50 crore in subsidies.
The company board in its meeting held here today approved payment of an interim dividend of 40 per cent or Rs 4 per share for the 2008-09 financial year.
GAIL said turnover was up 35 per cent to Rs 5,811.65 crore in the October-December quarter as it saw an increase in natural gas transmission and marketing revenues and petrochemical sales.
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During April-December, net profit was up 15.6 per cent to Rs 2,173.68 crore as opposed to Rs 1,879.08 crore a year ago. Turnover rose 35 per cent to Rs 17,671.64 crore as compared to Rs 1,30,72.91 crore in the corresponding period of previous fiscal.
In the nine months, GAIL paid a subsidy of Rs 1,781.2 crore, almost double of Rs 926.5 crore subsidy payout in the first nine months of April-December 2007-08.