Profitability Analysis: An Empirical Study of BSE Oil and Gas Index Companies

Abstract

The Indian oil and gas sector is of strategic importance and it has a pivotal role in influencing decisions in all other spheres of the economy. The annual growth of this sector has been commendable and will accelerate in future consequently it encouraging all round growth and development of the economy. The Indian oil and gas (O&G) sector is projected to touch US$ 139,814.7 million by 2015 from US$ 117,562.9 million in 2012. This sector provides ample opportunities for investor's .Profitability is the profit earning capacity, which is a crucial factor contributing to the survival of the firms. The objective of this study is to analyse the profitability position of the companies listed with BSE Oil and Gas index from the year 2003-04 to 2012-13. It was found from the analysis that Oil India Ltd. maintained first position in terms of profitability while BPCL stood last. It is suggested that companies should reduce their operating cost, efficient utilization of their asset base and increase in operational efficiency for enhancing the further profitability in future.