India’s flagship energy firm, Indian Oil Corporation Ltd (IOC), has turned around its performance in the second quarter of fiscal year 2026 (ended 30 September 2025), posting a robust net profit and signaling improved operational strength.
According to official filings, IOC reported a standalone net profit of approximately ₹7,610 crore, a dramatic rise from just ₹180 crore in the corresponding quarter of the previous year.
At the consolidated level, the company marked a profit of around ₹7,818 crore, compared to a loss of roughly ₹170 crore a year ago.
Revenue from operations increased by approximately 4 % year-on-year to about ₹2.03 lakh crore.
The turnaround has been largely attributed to a rebound in refining margins and lower input costs.
IOC’s gross refining margin (GRM) rose sharply, with estimates showing the April-to-September period averaging US $6.32 per barrel (versus US $4.08 per barrel a year earlier) and a current-price GRM of US $7.89 per barrel after inventory and other adjustments.
One report noted that the immediate quarter saw GRMs hitting around US $10.6 per barrel.
Meanwhile, input costs declined thanks to weaker crude prices and cost efficiencies, contributing to a margin improvement.
Refining operations—which handle a substantial portion of India’s oil-processing capacity—have benefited from higher crude throughput, stronger fuel spreads (especially in diesel), and increased export volumes.
At the same time, the marketing business remains closely watched: while fuel volumes showed recovery in July through September, lower margins in volumes-business and a weaker rupee remained headwinds for non-refining segments.
Analysts say the Q2 outcome underscores a much-improved business environment for Indian refiners after a period of margin pressure.
The low base from the prior year has amplified the YoY gains, but industry participants highlight that the sustainability of high margins will depend on external factors such as global crude-oil trends, export demand and the domestic fuel policy environment.
Despite the strong showing, IOC’s performance in non-refining segments warrants attention.
While refining margins rebounded, marketing margins may remain under pressure from regulated fuel prices in India and currency weakness, which can affect imports and exports of petroleum products.
With a sharp profit recovery, modest revenue growth, and favourable refining dynamics, the company appears to be in a stronger earnings phase.
Market observers will now track whether IOC can maintain its margin momentum and translate it into sustained value for shareholders amid evolving global and domestic energy conditions.
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