India’s largest oil company Indian Oil Corporation, recorded a 50 percent profit in FY19’s first quarter due to gain on its inventories, Mint has reported. The company’s statement said that its profits had risen from Rs 4,549 crore in first quarter(Q1) of 2017-18 to Rs 6,831 crore in first quarter of 2018-19.

Inventory gain is a benefit accrued to the company when it buys a product for a particular price but international price increases by the time it transports the product to the selling location. An inventory loss is the reverse of an inventory gain.

“The variation is majorly on account of higher inventory gains of Rs 7,866 crore during the current quarter, which is partly compensated by lower refining margins and exchange losses,” the company’s statement said. The company’s revenue increased from Rs 128,183 crore in Q1 of 2017-18 to Rs 149,747 crore in Q1 of 2018-19.

The gross refining margin (GRM) or the money earned for turning a barrel of crude oil into fuel rose from $4.32 in the previous year to $10.21 in Q1 of the current year. The company had booked an inventory loss in Q1 of 2017-18. Chairman of Indian Oil, Sanjiv Singh said that the company sold 21.6 million tonnes of petroleum products in the domestic market during Q1. This is a 4.3 per cent rise over 20.7 million tonnes in the previous year.