Country's largest oil marketing company, Indian Oil Corporation (IOC) announced financial results for the third quarter ended December 31, 2008. The firm managed to register 42 per cent increase in net profit at Rs 2,958.59 crore, on accounts of support through government bonds.

Sarthak Behuria, Chairman of IOC said, "In spite of inventory losses and lower refining margins, the profit could be achieved due to support from the government by way of additional bonds."

The company reported 4 per cent increase in net sales to Rs 60,875 crore in the reporting quarter and optimistic to perform better in the forth quarter. Mr. Behuria said, "The gross refining margin should be better this quarter and under-recoveries are unlikely to go up. Our ability to bear under-recovery this year is zero and the government has recognized this."

He said that the firm has still under-recoveries worth Rs 7,539 crore and government may issue bonds worth same amount to offset under recoveries.

It is to be noted that IOC received bonds worth Rs 23,951 crore during the nine-month period, helping it to cover losses.

The shares of company gained 2.43 per cent and closed at Rs 446.35 in the recent trading at Bombay Stock Exchange.