State-run explorer Oil and Natural Gas Corp (ONGC) Monday reported a 34 percent fall net profit for the quarter ending June mainly caused by subsidy it pays out.
Net profit in April-June fell 33.92 percent to Rs.4,015.98 crore from Rs.6,077.70 crore in the same period of the previous fiscal.
The company paid Rs.12,622 crore subsidy during the quarter through discounts on crude oil and LPG it sells to fuel retailers, as compared to Rs.12,346 crore in the same quarter last fiscal.
The difference between the cost and sale price is partly compensated by the government by way of cash subsidy. ONGC said the subsidy payout impacted net profit by Rs.7,131 crore.
The company's turnover was Rs.19,308.93 crore during the quarter in question as compared to Rs.20,177.78 crore a year ago.
The rupee's depreciation against the US dollar has resulted in widening losses on fuel sales and oil firms are currently losing Rs.9.29 per litre on diesel, Rs.33.54 a litre on kerosene and Rs.412 per 14.2-kg LPG cylinder.