Indian Oil Corporation (IOC) spent ₹12,162 crore on capital expenditure (capex) during the first half of FY27, achieving approximately 37% of its full-year investment target of ₹32,700 crore. The spending covered refinery expansion, marketing infrastructure, petrochemicals, pipelines, natural gas and research and development projects.
The pace is slower than the previous financial year, when Indian Oil had spent more than 47% of its annual capex target by the end of September. However, the company is approaching important milestones across several large infrastructure projects, including expansions at its Panipat, Gujarat and Barauni refineries. These projects are expected to increase processing capacity and strengthen India’s fuel supply infrastructure.
Key Takeaways
- Indian Oil spent ₹12,162 crore in H1 FY27, or approximately 37% of its ₹32,700 crore annual capex target.
- Refining and marketing accounted for the largest share of investment.
- Petrochemical projects received ₹1,306 crore, while pipeline projects received ₹582 crore.
- The company has projects worth approximately ₹1.04 trillion under implementation.
- Panipat, Gujarat and Barauni refinery expansions are targeted for completion by December 2026.
- Indian Oil reported record first-half crude throughput of 37.273 million tonnes and pipeline throughput of 53.896 million tonnes.
Indian Oil’s First-Half Capex Reaches ₹12,162 Crore
Indian Oil’s capital expenditure during April–September 2026 stood at ₹12,162 crore, against its FY27 budgeted target of ₹32,700 crore.
This represents approximately 37.2% of the company’s planned annual spending. The remaining ₹20,538 crore would need to be deployed during the second half if Indian Oil is to achieve its full-year target.
The first-half spending pace is lower than the more than 47% recorded during the corresponding period of the previous financial year. The difference makes the company’s second-half investment schedule important, particularly as several large projects approach completion.
Indian Oil’s management has said its investments are aligned with its long-term strategic roadmap and national energy priorities. The company is undertaking phased commissioning of process units, utilities and supporting infrastructure to bring additional capacity into operation.
Where Did Indian Oil Spend Its Capex?
Refining and marketing received the largest share of Indian Oil’s first-half investment. These businesses are central to its operations, covering crude processing, fuel production, storage and distribution.
The company’s investor presentation provided the following breakdown of H1 FY27 capital expenditure:
| Business segment | H1 FY27 capex |
|---|---|
| Refining | ₹6,083 crore |
| Marketing | ₹3,396 crore |
| Petrochemicals | ₹1,306 crore |
| Pipelines | ₹582 crore |
| Others | ₹432 crore |
| Natural gas | ₹133 crore |
| Exploration and production | ₹121 crore |
| Research and development | ₹109 crore |
| Total | ₹12,162 crore |
Refining and marketing together accounted for ₹9,479 crore, representing nearly 78% of the total first-half spending.
Petrochemicals received ₹1,306 crore, reflecting Indian Oil’s investment in expanding its presence beyond conventional fuel production. Pipeline investments are intended to strengthen the movement of crude oil and petroleum products across the company’s network.
The relatively small allocations to natural gas, exploration and production, and research and development show that the majority of the current investment programme remains concentrated in downstream energy infrastructure.
Indian Oil Has Projects Worth ₹1.04 Trillion Under Implementation
Indian Oil currently has projects involving investments of approximately ₹1.04 trillion under implementation.
Several major projects are approaching completion, including refinery expansions and petrochemical infrastructure. Their commissioning will be important for determining how effectively the company converts its investment spending into additional operating capacity.
Two significant projects are the Paraxylene-Purified Terephthalic Acid (PX-PTA) complex at Paradip Refinery and the New Mundra-Panipat Crude Oil Pipeline.
The ₹13,805 crore PX-PTA complex was mechanically completed in September 2026 and is undergoing commissioning. The pipeline project was mechanically completed in July 2026 and is also under commissioning.
Mechanical completion indicates that the main construction work has reached a significant milestone. However, commissioning and integration are still required before an asset can operate commercially at its intended capacity.
Three Major Refinery Expansions Target December 2026 Completion
The Panipat, Gujarat and Barauni refinery expansion projects are among the most important investments in Indian Oil’s current infrastructure programme.
The projects are designed to increase processing capacity at existing refineries, helping the company expand its refining operations.
| Refinery | Existing capacity | Target capacity | Project cost |
|---|---|---|---|
| Panipat | 15 MTPA | 25 MTPA | ₹38,231 crore |
| Gujarat | 13.7 MTPA | 18 MTPA | ₹18,936 crore |
| Barauni | 6 MTPA | 9 MTPA | ₹18,113 crore |
All three projects are targeted for completion by December 2026, according to the company’s investor presentation.
The Panipat expansion is designed to add 10 million tonnes per annum (MTPA) of refining capacity. Gujarat is expected to add 4.3 MTPA, while Barauni will add another 3 MTPA.
Together, the three projects aim to increase annual processing capacity by 17.3 million tonnes.
The expansions are particularly important because they use established refinery locations and existing industrial infrastructure. However, integrating new processing units with operating facilities requires careful commissioning, utility connections and supporting logistics.
Indian Oil Reports Record First-Half Operating Performance
The capex programme comes alongside strong operating performance during the first half of FY27.
According to Indian Oil’s October 30 operational update, the company recorded its highest-ever first-half crude throughput of 37.273 million tonnes. Its cross-country pipeline network handled 53.896 million tonnes, also a record for the first half.
Total sales volume reached 51.439 million tonnes, compared with 50.590 million tonnes during the corresponding period of the previous financial year.
Other operating highlights included:
- Domestic market share increased to 42.7% from 41.5% in H1 FY26.
- Petrol sales increased 9% to 8.946 million tonnes.
- High-speed diesel sales rose 8% to 19.862 million tonnes.
- Fuel and loss declined to 8.28%, the company’s lowest level in the post-BS-VI period, according to its disclosure.
These operating figures provide context for Indian Oil’s investment programme. The company is expanding infrastructure while continuing to handle large volumes of crude oil, petroleum products and fuel distribution.
Research, Petrochemicals and New Infrastructure
Indian Oil’s investments also include projects beyond refinery expansion.
The company is spending ₹3,220 crore on a new research and development campus at Faridabad in Haryana. The facility is intended to strengthen its research capabilities and support the development of new technologies.
Another project is a ₹2,949 crore polybutadiene rubber plant at Panipat. The facility will expand Indian Oil’s presence in specialised industrial materials and petrochemicals.
These investments reflect the company’s efforts to diversify its business while continuing to expand its conventional energy infrastructure.
Indian Oil’s management has also discussed a longer-term renewable-energy expansion programme. It plans to invest between ₹5,000 crore and ₹10,000 crore as equity contributions in joint ventures established for clean-energy projects over the next five years. The company’s reported renewable-capacity figures require clarification before the scale of its planned capacity expansion can be assessed reliably.
The Bigger Picture
Indian Oil’s FY27 capex programme highlights the investment requirements of India’s energy infrastructure. Rising fuel demand, industrial activity and transportation needs require continued spending on refineries, pipelines, storage facilities and distribution networks.
The company’s current investment priorities remain concentrated in refining and marketing, while petrochemicals and research projects support diversification. Renewable-energy investments represent another part of its longer-term strategy, although the current spending breakdown shows that conventional energy infrastructure continues to dominate capital allocation.
The difference between first-half spending and the annual target is worth monitoring, but the more important measure will be whether the projects under implementation are completed on schedule and generate additional operating capacity. Construction progress, commissioning timelines and the returns generated by these assets will determine the effectiveness of the investment programme.
Looking Ahead
Indian Oil will need to deploy a substantial portion of its remaining FY27 capex during the second half to meet its ₹32,700 crore annual target. The commissioning of the Paradip PX-PTA complex and the Mundra-Panipat pipeline, alongside the planned completion of the Panipat, Gujarat and Barauni refinery expansions, will be among the key milestones to watch.
For investors and the energy sector, the next phase will be about converting large infrastructure investments into productive assets. Indian Oil’s ability to complete projects on schedule, manage costs and improve operational efficiency will help determine how much value its current capital expenditure creates over the coming years.
Frequently Asked Questions
1. How much did Indian Oil spend on capex in the first half of FY27?
Indian Oil spent ₹12,162 crore between April and September 2026, equivalent to approximately 37% of its annual capital expenditure target.
2. What is Indian Oil’s FY27 capex target?
The company’s budgeted capital expenditure target for FY27 is ₹32,700 crore.
3. Which segment received the highest capex allocation?
Refining received ₹6,083 crore and marketing received ₹3,396 crore. Together, they accounted for ₹9,479 crore of first-half spending.
4. Which major refinery projects are nearing completion?
The Panipat, Gujarat and Barauni refinery expansions are targeted for completion by December 2026. They aim to add a combined 17.3 million tonnes per annum of refining capacity.
5. What is Indian Oil’s PX-PTA project?
The Paraxylene-Purified Terephthalic Acid complex at Paradip Refinery is a ₹13,805 crore petrochemical project. It was mechanically completed in September 2026 and is undergoing commissioning.
6. How much is Indian Oil investing in renewable energy?
The company has indicated that it plans to contribute between ₹5,000 crore and ₹10,000 crore as equity in joint ventures established for clean-energy projects over the next five years.
7. Why is Indian Oil increasing its capital expenditure?
The investment programme is intended to expand refining capacity, strengthen fuel distribution infrastructure, develop petrochemical businesses, improve research capabilities and support its longer-term energy strategy.
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