State-run GAIL India Ltd on Friday reported a 35 per cent drop in September quarter net profit as margins on natural gas marketing slumped and petrochemical business slipped into a loss.
Consolidated net profit of Rs 1,167.58 crore, or Rs 2.59 per share, in July-September compared with Rs 1,788.98 crore, or Rs 3.96 per share, profit after tax in the year-ago period, the company said in a regulatory filing.
While pre-tax profit from natural gas transmission business fell 10 per cent to Rs 803 crore, petrochemical business logged a Rs 82.32 crore loss. Natural gas marketing business saw pre-tax profit drop by 70 per cent to Rs 241.72 crore.
Pre-tax profit on LPG and liquid hydrocarbon business fell 68 per cent to Rs 245.35 crore.
In a statement, GAIL said improved physical performance in the current quarter helped the company in maintaining its gross turnover at Rs 18,010 crore.
"The physical performance has improved in petrochemical, LPG transmission, liquid hydrocarbon, and gas transmission segments by 59%, 21%, 11%, and 3% respectively as compared to Q1 of FY20," it said.
More From This Section
The company statement did not give a comparison with physical performance in the second quarter of the 2018-19 fiscal year.
"The market prices of petrochemicals and liquid hydrocarbons declined by 8% and 25% respectively coupled with lower gas prices in the international market which adversely impacted the profits of the company in the Q2 as compared to Q1 FY20," it said.
On a half-yearly basis, GAIL's gross turnover was almost unchanged at Rs 36,731 crore while net profit dropped 17 per cent to Rs 2,671.25 crore.
Ashutosh Karnatak, chairman and managing director, GAIL, said the company's physical performance in Q2 FY20 has been better due to operational efficiency as against Q1 FY20.
"The petrochemical plant is running at more than 100 per cent capacity. Further, volume of gas transmission is also showing an upward trend," he said, adding the lower prices of petrochemicals and liquid hydrocarbon, which are determined by international prices, have impacted the profit adversely.