Gulf Oil Lubricants India (GOL) saw profit rise to a record-high in the fourth quarter of last year as sales rose and cost pressures eased.
The trend lifted the Indian lube blender’s profit margin to the highest level in almost two years.
Blenders like GOL benefited from a steady rise in India’s lube consumption in 2023 on the back of the country’s strong economic growth.
GOL remained focused on boosting its sales volumes even faster by outpacing the country’s lube demand growth.
GOL’s operating profit of 1.07bn Indian rupees ($12.9mn) in the three months to end-December rose by 27pc from year-earlier levels.
Profit rose on the back of a 5pc increase in sales that outpaced a 2pc rise in costs.
Revenue got a boost from higher sales volumes, especially of passenger-car motor oils and lubricants for the agriculture sector.
The rise in costs was the slowest in three years and down from typical increases of more than 40pc in 2021 and 2022.
Cost pressures eased amid steadier prices of key inputs like base oils.
Asia’s Group II base oils prices fell by 5pc in the fourth quarter from year-earlier levels and by 13pc in 2023, ICIS data showed. The lower prices followed a surge in prices in 2021 and 2022.
With sales rising faster than costs, GOL’s operating profit margin of 13.1pc in the fourth quarter rose from 12.3pc during the previous three months to the highest since the beginning of 2022.
