State-run explorer Oil India faced a significant setback in its second-quarter earnings, reporting an over 80% drop in profit as it set aside ₹2,363 crore for an ongoing litigation. The profit for the quarter ended September 30 plummeted to ₹325 crore from ₹1,721 crore the previous year.
Despite the overall decline, there was a silver lining in Oil India’s performance. Profit before tax from its crude oil segment rose by nearly 42%, demonstrating the resilience of this segment. Additionally, the natural gas segment also saw growth, increasing over 24%, providing a positive outlook amid the challenges faced by the company.
Oil India attributed the drop in profit to charges related to an ongoing litigation concerning a service tax demand raised in the states of Assam, Arunachal Pradesh, and Rajasthan. The company has been actively contesting such disputed matters before various forums.
In terms of revenue, Oil India managed to show a 2.4% increase, reaching ₹5,913 crore for the quarter, indicating a relatively stable performance in terms of overall income.
Meanwhile, its peer company, Oil and Natural Gas Corporation Ltd, is expected to release its results on Friday. Despite the challenges, Oil India remains focused on navigating these obstacles, ensuring the stability and growth of its crucial segments in the oil and gas industry.
