State-owned gas utility GAIL India on Wednesday reported a 38 per cent drop in its fourth quarter profit after the company had to shell out more towards fuel subsidy.
Net profit in January-March quarter at Rs 483 crore, or Rs 3.81 a share, was down 38 per cent from Rs 783 crore in the year ago period, GAIL Chairman and Managing Director B C Tripathi said.
"The profits decreased because of a 55 per cent increase in subsidy outgo in the quarter to Rs 1,398 crore," he said.
Oil and gas producers ONGC and Oil India as well as gas utility GAIL make up for at least one-third of the revenues that retailers lose on selling diesel, domestic LPG and kerosene at government controlled rates.
In 2011-12, the three were asked to pick up a tab of 39.7 per cent of the Rs 138,541 crore revenue that retailers lost.
This was higher than 36.75 per cent in the previous year.
For the full fiscal, GAIL had to shell out Rs 3,183 crore, 51 per cent more than Rs 2,111 crore subsidy outgo in the previous year. But for this subsidy outgo, the company would have reported a net profit of Rs 5,804 crore, he said.
GAIL's actual net profit for the fiscal increased 3 per cent to Rs 3,654 crore.
Tripathi said GAIL will invest about Rs 7,400 crore in the current fiscal, most on building new gas pipelines.