Mumbai, April 25: The high prices of crude and natural gas have hit Mukesh Ambani-controlled Indian Petrochemicals Corporation Ltd. It has posted disappointing results for the fourth quarter ended March 31, 2006, as input costs went up and profit margins narrowed.

IPCL’s earnings fell 26 per cent to Rs 249 crore from Rs 336 crore in the corresponding period last year.

As product prices lagged behind the rise in raw material costs despite a robust demand, turnover came down to Rs 2,582 crore from Rs 2,989 crore in the same period last year. Net turnover was also lower at Rs 2,298 crore (Rs 2,643 crore).

IPCL said during the reporting quarter, petrochemical business worldwide was affected by high crude oil and natural gas prices leading to an increase in cost of raw materials and reduction in profitability margins.

However, for the year ended March 2006, net profit of IPCL shot up to Rs 1,005 crore from Rs 786 crore in 2004-05. Net turnover rose 3 per cent year-on-year at Rs 8,469 crore (Rs 8,199 crore).

Global prices of polyethylene, polypropylene, linear alkyl benzene were higher by 6 per cent, 7 per cent and 27 per cent respectively. Prices of poly butyl rubber and caustic increased by 23 per cent. Prices of poly vinyl chloride and mono ethylene glycol were lower by 12 per cent and 20 per cent respectively. Prices of raw materials like naphtha and propane were higher by 27 per cent and 14 per cent respectively. Also, there was a more than 50 per cent rise in the price of natural gas, the major feedstock for IPCL’s Gandhar complex, from July 2005.

Merger of 6 units

The directors have approved the merger of six units with IPCL, which include Apollo Fibres Ltd, Central India Polyester Ltd, India Polyfibres Ltd, Orissa Polyfibres Ltd, Recron Synthetics Ltd and Silvassa Industries Pvt Ltd. The appointed date of merger is April 1, 2005.