Indian Oil Corporation Limited (NSE: IOC) Q4 2025 Earnings Call dated May. 02, 2025
Corporate Participants:
Anuj Jain — Director Finance
R.V.N. Vishweshwar — Executive Director Corporate Finance and Treasury
Analysts:
Varatharajan Sivasankaran — Analyst
Probal Sen — Analyst
Sumeet Rohra — Analyst
Yogesh Patil — Analyst
Sabri Hazarika — Analyst
Achal Shah — Analyst
Nitin Tiwari — Analyst
Ritik Jain — Analyst
Ritvik Jain — Analyst
Presentation:
Operator
Ladies and gentlemen, good day, and welcome to the Indian Oil Corporation Limited results con call hosted by Antique Stockbroking Limited. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Varatharajan Sivasankaran from Antique Stockbroking Limited. Thank you, and over to you, sir.
Varatharajan Sivasankaran — Analyst
Thanks, Anurag. A very good afternoon, everyone. It’s my pleasure to extend a very warm welcome to all the participants and the management of IOCL for this call. We have with us from the management of IOCL, Mr. Anuj Jain, Director Finance; Mr. R.V.N. Vishweshwar, ED, Corporate Finance and Treasury; Mr. Pramod Jain, CGM Treasury; and Mr. Prabhat Himatsingka, CGM, Financial Treasury. I request the management to give an opening remark, and then we can move on to Q&A.
The floor Is yours, Mr. Anuj Jain.
Anuj Jain — Director Finance
Dear investors and analysts, a very good afternoon to all of you. I take this opportunity to welcome all of you to the conference call organized by us, post announcement of the fourth quarter and annual results of the financial year ’24-’25. I thank each one of you for joining the call. I believe you would have gone through the accounts posted on the website and also through the updates received by most of you. I would like to briefly dwell on the results to provide additional clarity and insights.
This quarter, we have listed a profit after tax of INR7,265 crores, which was INR2,874 crores in the preceding quarter and INR4,838 crores in the corresponding quarter of financial year ’24. On a year-on-year basis, the profit after tax for financial year ’24-’25 is INR12,962 crores as against the profit after tax of INR39,619 crores for the financial year ’23-’24. Revenue from operations during this quarter is INR217,725 crores as against INR216,649 crores in the preceding quarter of this year. The revenues for the corresponding quarter of financial year ’23-’24 was INR219,876 crores.
On a year-on basis, the revenue from operations during the financial year ’24-’25 is INR845,513 crores as against the revenue from operation of INR866,345 crores in financial year ’23-’24. This year, we witnessed many challenges and volatility. I am proud to share that despite the headwinds, Indian Oil pulled off a strong operational and financial performance, registering historically higher sales volumes, historically highest pipeline throughput and one of the best distillate yield levels. This reflects the strength of our operational model, the efficiency of our distribution network. These are broad highlights of the results of the company.
Now I will request ED, Corporate Finance and Treasury, Shri, R.V.N. Vishweshwar to take this con call forward.
R.V.N. Vishweshwar — Executive Director Corporate Finance and Treasury
Thank you, sir. Participants are advised to refer to the company’s latest filings with the regulatory authorities for a more detailed discussion on the risks and uncertainties and kindly note that today’s discussion may include forward-looking statements, which are based on currently available information, assumptions and expectations, and are subject to uncertainties that could cause actual results, performance or achievements to differ materially from those expressed or implied.
The global macroeconomic environment in financial year ’24-’25 was marked by significant challenges and volatility. Persistent geopolitical tensions, particularly down from 6.5% and the Reserve Bank of India has lowered its estimate to 6.5% from 6.7%. Various economic data points and projections by domestic and international agencies indicate robust energy demand in the country and continued importance of petroleum products to meet the increasing energy demand. Being the country’s largest oil refinery marketing company, Indian Oil is committed and steadfast in ensuring energy availability across the length and breadth of the nation at affordable cost.
Indian Oil has envisioned to increase its share in the national energy basket from 9% to 12.5% by the year 2050 in alignment with the anticipated doubling of the country’s overall energy demand. This transformation will be anchored in a balanced portfolio that continues to leverage the strength of the conventional fuels while expanding decisively into cleaner, more sustainable energy vector. Indian Oil is making high-impact infrastructure investments in expanding the refining capacity from 80.8 million metric tonnes per annum to 98 MMTPA by ’26-’27, coupled with matching investments in marketing and pipeline infrastructure.
While reinforcing the conventional energy strengths, Indian Oil is also making targeted investments in sustainable and future-ready energy pathways. A key enabler for this transition is a wholly-owned green subsidiary, Terra Clean Limited, which is spearheading our green ventures. Indian Oil Board has already accorded approval for implementation of 5.3 gigawatt of RE projects through Terra Clean Limited. Complementing this are our concurrent efforts to scale up electric mobility infrastructure, including the rollout of EV charging and battery swapping stations, harnessing natural gas, CBG, biofuels, green hydrogen, including hydrogen mobility pathways. The upcoming 10 Kta green hydrogen plant at Panipat and India’s first commercial scale sustainable aviation fuel plant underscore Indian Oil’s leadership in green energy.
Now let me just briefly touch upon the quarterly performance highlights. Talking about the numbers. The average price of crude Indian basket during this quarter was at $76.77 per barrel, an increase of about 3.9% from the average price of the immediate preceding quarter, that is quarter 3. If we compare on a corresponding quarter basis, just $81.6 per barrel in quarter 4 2024, there is a reduction of around 6%. Various geopolitical factors starting from the imposing of tariff by the new U.S. government, rising U.S. inventories, OPEC production adjustments have contributed in cooling the crude oil prices.
With respect to the crack spreads, dollar per barrel for the Indian basket, during quarter 4 FY ’25, MS cracks has largely remained in line with the previous quarter, which was $3.11 versus $3.29 in the previous quarter. Cracks are lower than the corresponding quarter of FY ’24, that is $7.81 per barrel. For HSD, the crack spreads during this quarter was at $11.33, have remained lower than the preceding quarter, which was at $12.19. The cracks were also lower than the corresponding quarter of FY ’24, which was at $17.46.
In the petrochemical space, the spreads in terms of dollar per metric tonne of major products continued to be suppressed during the year. On a year-on-year basis, the spreads for polymers have remained similar. The spreads of PTA has witnessed a sharp decline and the spreads of MEG, while has improved marginally, but continues to be negative. The weak global economic outlook and new capacities continue to weigh high on the petrochemical price globally.
Now let me briefly touch upon the major verticals. Refineries. The throughput during the quarter was 18.5 MMT with a capacity utilization of 107.1%, which is higher than the preceding quarter of 18.1 MMT and a capacity utilization of 102.3%. And also, higher than the corresponding quarter of FY ’24, which was 18.3 MMT at a capacity utilization of 104.5%. The distillate yield was at 79.7% during the quarter, which is slightly lower as compared to the previous quarter, 82.2%, but better than the corresponding quarter of FY ’24, which was 77.5%. Fuel loss during this quarter was 8.6%, whereas during the preceding quarter, it was 8.7%. Our refineries have registered a GRM of $7.85 per barrel during this quarter as compared to $2.95 per barrel during the previous quarter.
Overall, on the year-wise, GRM for FY ’25 was $4.80 per barrel as against $12.05 per barrel in the previous year. The normalized GRMs after stripping off inventory impacts and factoring price drags for the quarter is $5.39 per barrel as against $6.60 per barrel in the previous quarter. For the full financial year, the normalized GRMs for the FY ’25 is $4.53 per barrel as against $11.44 per barrel in FY ’24. A decline in product crack spreads, which is also reflected in benchmark Singapore GRMs has been the main reason behind this fall in GRM.
Now coming to pipelines. The capacity utilization was about 73% during this quarter as compared to 69.6% in the previous quarter. Indian Oil’s cross-country pipelines achieved throughput of 100.5 MMT during ’24-’25 this year and by crossing 100 MMT milestone, achieved the highest-ever recorded throughput this year. Pipeline throughput during the quarter for ’24-’25 is 25.8 MMT vis-a-vis 24.9 MMT in quarter 3 of ’24-’25. During the year, the company has further expanded its pipeline network by 260 kilometers, taking Indian Oil’s total pipeline network to above 20,000 kilometers, which accounts for more than 50% of the total pipeline network of the country. The largest pipeline network provides strategic access to the market and helps reduce the cost of placement of products.
Marketing. Indian Oil achieved the highest ever sales volume of 100.29 MMT during the year in all segments. That is petroleum, petrochemicals and gas crossing the 100 MMT milestone for the first time. Corresponding sales volume during the previous year was 97.5 MMT. Sale of petroleum products during quarter 4 of ’24-’25 was 23.19 MMT, which is slightly lower as compared to 23.38 MMT in the previous quarter. However, sales were higher than the corresponding quarter FY ’23-’24, which was 22.7 MMT. For the financial year, sales of petroleum products have improved. That is 89.80 MMT in ’24-’25 vis-a-vis 88.45 MMT in the previous year.
Petrochemicals. The sale of petrochemical products during this quarter was 0.83 MMT as compared to 0.89 MMT in the preceding quarter. Sales for Q4 2024 was 0.818 MMT. For the full financial year, petchem sales were at 3.236 MMT, they’re more than the sales recorded in FY ’24, which was at 3.063 MMT.
Capex. During FY ’24-’25, the company incurred a total capex of INR37,557 crores encompassing investments across all verticals. These investments are aligned with a long-term strategic road map and national energy priorities. For FY ’25, ’26, the budgeted capex is INR33,494 crores. Going forward, as the large-scale refining products mature, we expect a tapering of expense in conventional sources and significant shift in capex allocation towards petrochemicals and alternate energy segments, where we are placing high strategic bets.
Borrowings. With respect to the borrowing levels, the borrowings as on 31st March ’25 has increased by about INR18,000 crores on a year-on-year basis, and is at INR134,466 crores level as compared to INR116,496 crores as on 31 March 2024. The increase in borrowings are mainly on account of ongoing capex. On a quarter-on-quarter basis, there has been an increase over INR3,000 crores as compared to previous quarter. The increase is mainly attributable to year-end duties and taxes. With the current debt-to-equity ratio of 0.75 as on 31 March ’25, Indian Oil is comfortably placed to fund the ongoing capex plans.
With this, I’ll pause here, and I’ll request that Director Finance for his further remarks.
Anuj Jain — Director Finance
Thank you, Vishweshwar. So friends, as we move forward into financial year ’25-’26, our focus remains on operational excellence, prudent capital allocation and strategic investments that will strengthen our existing business and also position us to lead in the evolving energy landscape. I would like to thank our shareholders, employees, partners and stakeholders for their continued trust and support. We are confident in our ability to deliver sustainable value even amidst a dynamic external environment.
Now I will end my briefing here. We will now be open to take your questions. Thank you.
Questions and Answers:
Operator
Thank you, sir. Ladies and gentlemen, we will now begin with the question and answer session. [Operator Instructions] The first question comes from the line of Probal Sen from ICICI Securities. Please go ahead.
Probal Sen
Thank you for the opportunity and thank you for hosting this call. Sir, just a couple of questions. Firstly, on the refining business. It’s very clear that if we normalize it for inventory, the GRM has actually declined a bit. But just wanted to understand what was the contribution of Russian crude in overall sourcing in this quarter? And what is it so far in the first quarter of FY ’26?
R.V.N. Vishweshwar
See, as far as Russian crude is concerned, we had imported 22% in ’24-’25 for the full financial year. Although in the fourth quarter, it came down. It came down to almost 14%. But for the full financial year, it was 22%.
Probal Sen
And have we seen an improvement in these numbers in this first quarter, sir, with the prices going down?
Anuj Jain
We have again seen the increase in the Russian crude availability, and we are hopeful that this year in ’25-’26, we should be touching around 24%, 25%.
Probal Sen
Okay. Okay. The second question was, sir, with respect to the capital allocation plans, sir. You mentioned about the shift that is driven to petrochemicals and renewables. In petrochemicals, however, what we have been seeing consistently over the last few years is that there just doesn’t seem to be a shift to sustainable margins at least for — from what we can tell. So how do you really look at the petrochemical margin environment? And what gives us the confidence that margins will actually improve enough that we can start making reasonable returns given that our focus is increasingly shifting to the petrochemical segment for the next 5 years?
R.V.N. Vishweshwar
See, you must have seen our figures. Today, my petrochemical intensity is around 6%, which we want to increase to 15% by 2030 in the next 5 years. Already we have announced the projects to achieve these targets. As far as margins are concerned, yes, margins are down, but it is a cyclical industry. And we understand that the cycle will come back. We don’t give the specific time, but the cycle is expected to turn around in the next 2 to 3 years. So the petchem margins should also improve by the time our come back.
Probal Sen
If I may be permitted, sir, let me ask it another way. If I can get a sense what are the gross margins on a dollar per tonne basis that we are seeing in our business today? And what is the kind of level we sort of would need for these investments to be profitable? If you can give us a sense on that?
Anuj Jain
See, as far as all these are integrated projects, whatever inputs are coming to the naphtha or whatever it is coming from existing streams. On an integrated basis, we — see, we have 2 things. One is the cracks of our existing products and the cracks on the polymers, glycos and LED and these PTA. So today, the cracks on the petchem is coming down, although on the refining side, the cracks are still okay. Even on the petchem side, you see cracks on polymers are okay, but PTA and glyco, the margins are quite down. So as I said in the beginning, we don’t have any specific numbers, but because it’s a basket of many things, which makes us think positive. So today, the petrochemical margins are down, but we expect that it will come back.
Probal Sen
Okay, thank you so much for the answer. I’ll come back. Thank you so much and all the best.
Anuj Jain
Thank you.
Operator
The next question comes from the line of Sumeet Rohra from Smartsun Capital. Please go ahead.
Sumeet Rohra
Yeah. Hi, sir. A very good afternoon to you and your entire IOC team. Sir, just a couple of questions. First, if you can — firstly, your performance has been very commendable. So congratulations on that. You guys have done a very, very good performance in a very challenging environment. Sir, I’m just looking at overall profitability rather than on any quarter because the thing is that if you see that we reported approximately a profit of about INR13,000 crores, and this is after absorbing the LPG under-recovery, which is of INR19,000 crores, INR2000 crores. Now sir, of course, LPG is a controlled product and the government will compensate you on that. So sir, can you please throw some idea on when we could receive the LPG money?
And sir, secondly, you spoke about capex coming down from INR37,000 crores to about INR33,000 crores, INR34,000 crores. Sir now the matter of fact is that we always speak on capex, but can you also talk a little bit on earning momentum because over the last couple of financial years, you have — all of you have done very well. So can we just get a sense on how do you expect earnings to shape up in the current year? Because now crude is also in our favor, right? I mean it’s below $70 on a sustain — hopefully on a sustainable basis. So sir, can you please talk a little bit about how you see profitability shaping up in a conducive environment of crude?
My second question, sir, is on the retail outlets. So how many retail outlets do we have currently? And how many have we added? And how many do you plan to add? And my last question, sir, is on GRMs. So do you expect — I mean, what do you expect in a sustainable GRM scenario for the current year, sir?
Anuj Jain
Okay. Sumeet, I will take your question one by one. The first question was regarding the overall profitability for the year ’24-’25. See, as you have said that we have given a very good profitability. As far as the LPG under-recovery is concerned, you must have seen that we are continuously engaging with the government. And we are hopeful that our continuous engagement with the government will give us positive results. The time and the quantum is not known, but it is all depending upon the many factors, geopolitical factors, other things, which keep on affecting the oil marketing companies.
As far as your second question is concerned regarding the next year profitability or margin scenario, see, our profitability consists of 3 or 4 factors. One is the refining margins. which as of today is looking good. If you see on a day-to-day basis, the margins have come down drastically from ’23-’24, but the margins are still reasonably okay. Marketing margins are positive for us. Third is the petchem margins are a little bit tightened up, but we hope that the petchem margins will remain constrained in the coming quarter, but not for all the segments. For a few segments in petchem, it will be a constraint.
So as far as the ’25-’26 are concerned, we hope that it should be a good year for the oil marketing companies and Indian Oil to be particular. And as far as the third question is concerned, the — first I will come to the GRMs. So see, the GRM, if you see today, the fourth quarter GRM is net of — it is $7.85. And even after normalizing, it is a reasonable margin for the company. We expect refining margins to be pretty good for us going forward in this year. Now coming to the specific fourth question on the number of ROs. See we plan to — today, this year, we have crossed 40,000 retail outlets, and we plan to add almost 3,000 to 4,000 ROs in the current financial year. If you see 31st March, we had almost 40,221 retail outlets. So we plan to add another 3,000 to 4,000 in the current year.
Sumeet Rohra
Okay. Sure. Sir, thank you so much.
Anuj Jain
Thank you.
Operator
Thank you. The next question comes from the line of Yogesh Patil from Dolat Capital. Please go ahead.
Yogesh Patil
Thanks for taking my question and congratulations for the good set of numbers, sir. Sir, I wanted to check, is there any oil product inventory gains during the quarter? And also wanted to know your gross marketing margins on other oil products, excluding petrol, diesel and LPG. Was it better during the quarter compared to the last quarter?
Anuj Jain
See, yes, in the quarter 4, we had an inventory gain, and that has helped us to report better numbers this year. As far as — and as far as your second question is concerned, whether the margins on other marketing products other than MS HSD, LPG are concerned, yes, the margins were better in the quarter 4 vis-a-vis earlier quarters.
Yogesh Patil
Sir, could you please share the inventory gains on the oil product side, if you have any number handy?
Anuj Jain
See, as I told you that we had a positive inventory margins. And other products, see, we don’t calculate inventory gains on product by product actually. It’s a consolidated figures. So — but the margins have improved for other things also, other products.
Yogesh Patil
Sir, my second question is related to our refinery expansion plans, Panipat, Koyali, Barauni. Can you provide us a physical completion, commissioning time line? And if you can give us some idea about the actual earnings growth from these 3 incremental refining capacities, that would be helpful.
Anuj Jain
See, if you see in Panipat, we are adding 10 MMTPA. We are going from 15 to 25. In Gujarat, we are going from 13.7 to 18, which will add another 4.3 MMTPA. In Barauni, we are going from 6 to 9. So we are going to add another 3. So almost we are adding almost, you can say, 18 MMTPA in our system, okay? Now as far as commissionings are concerned, both Panipat and Gujarat are expected to come in the fourth quarter of ’25-’26. And it will mostly stabilize in ’26, ’27. As far as Barauni is concerned, it is expected to come in the first quarter or second quarter of ’26-’27.
Today, all the refineries have already achieved a physical progress of more than 80% today. So we are going in a very good targeted speed to achieve the targeted commissioning dates. And the expected revenue from all the new commissioning would definitely depend upon the refining margins prevailing at that point of time. So I will be saying that whatever refining margins would be there, definitely, all the expansions will help us to achieve the return on investments on our —
Yogesh Patil
Okay. And lastly, sir, post completion of incremental refining and the petrochemical capex, what would be the peak net debt-to-EBITDA ratio? Any ballpark number you have in mind?
Anuj Jain
See, it will be very difficult to quantify in the EBITDA percentage terms. But see, you can — I’ll tell you. Today, I’m at 70 MMTPA. And if I am adding another 18 in my system, so it will become — it will become 88, 89. And then we have CPCL also with us. So all put together, my refining capacity will go beyond 100 MMTPA.
Yogesh Patil
Thanks. Thanks a lot sir. This was really helpful.
Anuj Jain
Thank you.
Operator
Thank you. The next question comes from the line of Sabri Hazarika from MK Global Financial Services. Please go ahead.
Sabri Hazarika
Yes sir. Sir, two questions. First one is on the inventory side only. So I just wanted a number. I think last year, INR1,686 crores was the total inventory gain for the company. So versus that in FY ’25, what would be the number? FY ’24 number was INR1,686 crores.
Anuj Jain
See, as far as my financial — full financial year is concerned, we still had an inventory loss.
Sabri Hazarika
Yes. And how much would it be?
Anuj Jain
I had inventory gain but on the full year I still had an inventory loss actually. So some figures. I’m just giving you indicated figures that in 2324 for the full financial year we had an inventory gain.
Sabri Hazarika
Right? Right.
Anuj Jain
Quarter 4, I had inventory gain, but on the full year, I still had an inventory loss actually.
Sabri Hazarika
And what will be the figure?
Anuj Jain
Some figures — I’m just giving you indicative figures that in ’23-’24 for the full financial year, we had an inventory gain. So this was the figures. But yes, in Q4, we had an inventory gain vis-a-vis — overall on a year basis, we still have inventory loss.
Sabri Hazarika
Yes, but any ballpark number because it is a reported figure, sir, because you have been giving it, I think. So that’s why I’m asking.
Anuj Jain
We have already shared these numbers. You will see it from one of our statements, which we have given.
Sabri Hazarika
Okay, sir. Okay. Fair enough. And secondly, on the project side only, so you mentioned about the refinery expansions. So all these expansions have got polypropylene unit also, sir, that would also be simultaneously commissioned or that could be later actually?
Anuj Jain
Let me see. Polypropylene is coming in — see, it is independent of this. What — and see, as I said in the beginning also, apart from the refining expansion, we are also targeting the petchem extensions going forward. And I gave the numbers also from 16% petchem and —
Sabri Hazarika
I can understand. I mean, the polypropylene unit commissioning will also be at the same time that you gave regarding the refinery expansions or that will come afterwards?
Anuj Jain
Yes, commissioning 1 or 2 months here and there, it will be happening in the same time.
Sabri Hazarika
Okay. Fair enough. And regarding some other projects, so you have that acrylic project in Gujarat. When is that expected to commission? And what about the Paradip Refinery, PX PTA project? What is the time line for those two?
Anuj Jain
See as far as that is concerned, Oxo-alcohol project in Gujarat, is expected to commission in — it is already commissioned. Oxo-alcohol project in Gujarat, it is commissioned in the month of May.
Sabri Hazarika
May, right. And PX PTA of Paradip Refinery?
Anuj Jain
PX PTA will be in April ’26.
Sabri Hazarika
April 2026, right? And beyond that, we have got this big Paradip petchem complex, which you have signed an MOU. So I think the Stage 1 approval was done. So what is INR61,000 crores, so what is the time line for that actually? So I think Stage 2 approval is still pending, but any time line you want to give for that?
Anuj Jain
See, Stage 1 was given in ’23 — March ’23, okay? And the approximate cost is INR61,000 crores. And the commissioning schedule, what we have is approximately 54 months from the date of investment approval. So it is too early to say, but yes, it will take 4.5 years from ’23. So somewhere around ’29, ’30, it will happen.
Sabri Hazarika
Okay, sir. And beyond this, there is no other petrochemical project major one, right, other than this?
Anuj Jain
See, recently, we have — we — as a Board, we are discussing a few of the projects. But definitely, a few of the new announcements you will hear very soon because we have another polypropylene unit at Barauni coming in ’26-’27. Then we all have polypropylene units in the expansion category. Then we have PX PTA at Paradip, which is coming almost for INR14,000 crores in end of this financial year ’25-’26. And we have another 2, 3 projects of polybutadiene rubber, which is coming in ’26, ’27, for 3,000 —
Sabri Hazarika
This is this Panipat one, right, the styrene monomer, right? That’s what you’re talking about.
Anuj Jain
Yes, yes.
Sabri Hazarika
Okay. Okay. FY27. Okay.
Anuj Jain
But we have other coming few — very soon, you will be listening a few new expansions in petchem.
Sabri Hazarika
Okay. Some more announcements will come, you are saying, right?
Anuj Jain
Yes, yes.
Sabri Hazarika
And on pipeline, any that ET — Ennore-Tuticorin, that is largely ready or that is also some part is pending right now?
Anuj Jain
Which one?
Sabri Hazarika
The Ennore-Tuticorin, that big pipeline project in Tamil Nadu?
Anuj Jain
I think it is completed.
Sabri Hazarika
It is also completed, fully connected, right?
Anuj Jain
Yes.
Sabri Hazarika
Thank you and all the best.
Operator
Thank you. The next question comes from the line of Achal Shah from AMBIT Capital. Please go ahead
Achal Shah
Sir, am I audible?
Anuj Jain
Yeah.
Achal Shah
Sir, just wanted to know, so what is the current under-recovery per cylinder? And what is the future outlook? Like do you feel this under-recovery will continue after the INR50 price hike?
Anuj Jain
See, it keeps on changing, but today, it is on INR170 per cylinder.
Achal Shah
Got it. Thanks. Thanks for your time.
Operator
Thank you. [Operator Instructions] The next question comes from the line of Nitin Tiwari from PhillipCapital. Please go ahead.
Nitin Tiwari
Good afternoon sir. Thanks for the opportunity. Sir, my first question is with regards to capex, if you can help us with the breakup of the capex between different segments for FY ’25 as well as FY ’26, the projections that you’ve given.
Anuj Jain
See as far as the capex is concerned, we are targeting INR34,000 crores in ’25, ’26, okay? And if you see on a refining and pipelines put together, it should be somewhere around INR70,000 crores. So almost 50% will go towards the refining and pipelines and others will come in marketing segment, petchem and other investments what we have announced.
Nitin Tiwari
Sir, any specifics if you can provide, please, in terms of how much in petchem, how much in marketing and CGD as well?
Anuj Jain
See on a ballpark figure, I would say, generally, we will spend around INR7,000 crores to INR8,000 crores in marketing. And petchem, we should be spending around INR3,000 crores.
Nitin Tiwari
And in CGD, sir?
Anuj Jain
CGD is basically we are doing a lot of through joint venture companies. And it should be somewhere around INR500 crores.
Nitin Tiwari
And FY ’25 capex would be in similar ballpark, what you indicated for ’26, ’25 would be similar? Or if you can give us some specifics around ’25 as well? Okay, sir. And sir, my next question was related to petrochemical. I think one of the participants also asked on similar lines. So just wanted to understand that are we breaking even in petrochemical if we look at in pre-depreciation terms? Are we like EBITDA-positive in petrochemicals or we are EBITDA-negative as well? Because EBIT number is something, which you have given out in your press release. I was wondering if we are EBITDA positive or not?
Anuj Jain
No, we are definitely EBITDA-positive in the petchem.
Nitin Tiwari
So we’ve reported about INR200 crores of loss at EBIT level in petchem. So what would be the EBITDA number roughly, sir? Or if you can just — because of the depreciation number. So sir, we have a ballpark understanding of where we lie in terms of petrochemical margins?
Anuj Jain
See, almost we would be EBITDA positive INR1,000 crores for ’24-’25.
Nitin Tiwari
Petchem EBITDA is around INR1,000 crores is what you’re saying, right?
Anuj Jain
Yes, yes.
Nitin Tiwari
Great, sir. Those would be 2, if I may like ask one more. Like crude oil prices have corrected quite meaningfully. So is it the right understanding that, that would help release some amount of working capital? If you can give us any indicative number, how much of debt reduction could happen if our working capital goes down and because if crude remains where it is.
Anuj Jain
See, definitely, reduction in crude oil prices will help us to reduce our working capital, definitely. And — but definitely, it should be in the range of maybe INR10,000 crores, it will help us. If the reduction is as high as what we are seeing today by $10 per barrel, then it should be around INR10,000 crores.
Nitin Tiwari
So I mean you’re saying that $10 per barrel would roughly lead to a INR10,000 crores saving in working capital and accordingly a reduction in debt, right?
Anuj Jain
Yes.
Nitin Tiwari
Okay sir, understood. Thanks a lot. That’s all from my thank you.
Operator
The next question comes from the line of Ritik Jain from Nirmal Bang. Please go ahead.
Ritik Jain
Yes sir. Congratulations for a good set of numbers. My first question is on the sales volume of CGD gas in 4Q FY ’25 and FY ’25?
Anuj Jain
Yes. See, as far as my numbers of CGD is concerned, we are getting better day by day. Out of 26 GAs already 6 GAs have become EBITDA positive. And by next year, we hope that we will have another 7 to 8 GAs will be becoming EBITDA positive. As far as sales are concerned, I almost had a sales of 115 TMT sales of CGD.
Ritik Jain
In 4Q FY ’25?
Anuj Jain
Yes. ’24-’25, yes.
Ritik Jain
So this is for full financial year, sir, right?
Anuj Jain
As I shared with you just now that we will be becoming EBITDA positive for further GAs. And on an overall segment basis, also, we are — we will be EBITDA positive from next year.
Ritik Jain
Okay. And what was the reason for the decline from Gas segment EBIT in 4Q FY ’25?
Anuj Jain
No, I don’t think so we had a negative — our gas profitability has gone up significantly. We have almost a 50% jump in the profitability from the Gas segment this year.
Ritvik Jain
I’ll come back in the Q and A.
Anuj Jain
Yes please.
Operator
Thank you. The next question comes from the line of Sumeet Rohra from Smartsun Capital. Please go ahead.
Sumeet Rohra
Yeah, hi sir, thanks for the opportunity. Sir, just a couple of things. I was basically just wondering now from an investor point of view that our dividend payout in absolute number of rupees has been lower this year because of the LPG under-recovery money, what we’ve not received, which has hampered profitability. So sir, is it safe to assume that when — once you get the LPG under-recovery from the government, investors can expect a dividend payout, which was similar to FY ’24 level? Because anyway, 53% of the money goes back to the government itself, right? So can we expect that?
And sir, secondly, on the LPG part as well, if I remember the honorable Oil Minister had mentioned that the prices will be reviewed on a 30-day basis or slightly lower on a fortnightly basis. So do you get the early sense that we could be entering an era of LPG prices could be market aligned and then eventually decontrolled. Any thoughts on that, sir?
Anuj Jain
Yes. As far as the dividend is concerned, in the past 10 years, you would have seen Indian Oil is one company which has always been giving very reasonable dividends to all its stakeholders. So in the last year, since the profitability was very good, we declared a very high dividend. This year, based on my profitability, I’ve again given a reasonable dividend to all the shareholders. As the second question is concerned about your LPG under-recovery, I don’t have a specific answer that what would be the government policy on that. But definitely, we keep engaged with the government to monitor our LPG prices.
Sumeet Rohra
Okay. No, sir, because the only reason why I asked this is because since it’s a controlled product, and we are basically — so it’s kind of not a sustainable model, right, where we keep bearing the LPG burden, right? So that’s exactly why I was thinking on those grounds.
Anuj Jain
No. Your concern is well noticed, and we have been continuously — all the oil marketing companies get engaged with the government to see what would be the quantity and quantum and timing to get these under-recoveries.
Sumeet Rohra
Okay. Sure sir. Thank you so much. Thank you.
Anuj Jain
Thank you.
Operator
Thank you. [Operator Instructions] The next question comes from the line of Yogesh Patil from Dolat Capital. Please go ahead.
Yogesh Patil
Thanks for taking my question sir. Sir, as per the latest news flow, U.S. crude imports have gone up for the India. Just wanted to understand how much quantity of U.S. crude IOCL can process considering economic benefits, SME?
Anuj Jain
See, yes, you are true that in ’23-’24, we almost processed 4% crude vis-a-vis 9% what we did in ’24-’25, but it is absolutely on an economic basis. Whenever — as a system, we don’t have any targets to process any specific crudes. For us, any crude is equivalent depending upon the price at which it is available to us. So on an optimization level, whatever crude enters through a tendering system, it is being procured by the company. So we don’t have any specific targets for any type of crude in the system.
Yogesh Patil
Okay. And sir, just wanted to understand landed basis, what is the benefit or discount if we get US crude imports? Any ballpark number, if you can share?
Anuj Jain
See, any — this is what I said that no crude is having any benefit to us. Any crude, which comes in has to justify on the basis of the best crude available on that particular day to us. So when we come out with the offer, so many people compete with each other, whether it is West African crude, Middle Eastern or U.S. or — so people have to compete and then come into our system. Till the time it is beneficial to me, it cannot — we don’t procure anything.
Yogesh Patil
Okay. Sir, lastly, considering the capex run rate of INR33,000 crores, INR34,000 crores per annum for the next few years and a reasonable dividend payout, what should be the minimum marketing margins on the — mostly on the petrol and diesel side? Have you calculated anything that should be the minimum so that the capex can be funded through the internal cash flows and the healthy dividends would be there. So any number, ballpark number, which you can share?
Anuj Jain
See, you have to understand all the companies working on an RTP basis. See, for the marketing — even the marketing group of ours, they procure the goods on RTP basis from our own refinery. Whether we process the crude from our own refinery system, marketing will have to earn its own marketing margins. And there is a structured system of getting — pricing the marketing margins in our pricing. So if the prices remain what is today, we should be having a reasonable marketing margins on all our products. So it is very difficult to say at what level. Definitely, all the oil marketing companies should earn a reasonable marketing margins. And as on date, today, if we talk about, we have a positive marketing margins.
Yogesh Patil
Thanks. Thanks a lot sir.
Operator
[Operator Instructions] Ladies and gentlemen, as there are no further questions, I would now like to hand the conference over to Mr. Varatharajan Sivasankaran to give his closing comments.
Varatharajan Sivasankaran
I had one small question, sir. On the Barauni refinery, you had announced increase in capex cost. So should we assume that like in Panipat and Koyali, you don’t have an increase in capex cost. So should we go with the original cost?
Anuj Jain
See, we had — we have revised the cost of both Panipat and Gujarat a few months back. So whatever the latest estimates management has approved, commissioning is happening according to that. So Barauni has come this time.
Varatharajan Sivasankaran
The floor is yours for your closing remarks, sir.
Anuj Jain
Yes. Thank you all for your time and insightful questions. On behalf of the entire management team, thank you once again for your continued trust and support. We look forward to engaging with you in our future interactions and keeping you updated on our progress. Stay safe and take care. Jai Hind. Jai Indian Oil.
Varatharajan Sivasankaran
Thank you, sir. I would like to take this opportunity to thank the management. It was a pleasure having you on the call answering all the questions. And thanks all the participants for taking time out to join the call. Thanks, everyone, and have a nice day.
Operator
[Operator Closing Remarks]