Gujarat Gas Concall February 2025: Key Updates and Future Plans

Gujarat Gas Concall (GUJGAS) – February 2025 Update

Company Overview

Gujarat Gas Concall: Gujarat Gas Limited (GGL) is India’s largest City Gas Distribution (CGD) company. It operates across 27 geographical areas in six states and one union territory. The company has built an extensive pipeline network of over 42,000 kilometers, supplying gas to around 22.27 lakh households, 4,430 industries, and 15,590 commercial units.

GGL runs 825 CNG stations that fuel approximately four lakh vehicles daily. The company is continuously upgrading its CNG infrastructure and has also started injecting biogas into its network.

Gujarat Gas Concall

Financial Performance

In the nine months ending December 31, 2024, Gujarat Gas achieved a total volume of 9.73 mmscmd, reflecting a 5% growth from the previous year.

• Revenue Growth: The revenue for Q3 FY25 reached ₹4,333 crores, up from ₹4,084 crores in the same quarter last year.
• Profit After Tax: The profit stood at ₹222 crores, showing a slight increase from ₹220 crores year-on-year.
• EBITDA: Earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to ₹439 crores, compared to ₹424 crores in Q3 FY24.

Market Trends

• Industrial Segment: Sales volume in the industrial sector declined slightly to 5.45 mmscmd in Q3 FY25, compared to 5.53 mmscmd the previous year. This drop was mainly due to shutdowns during the Diwali period.
• CNG Sales: Sales in Gujarat increased by 11% year-over-year, while outside Gujarat, the growth was an impressive 26%.
• Competitive Pricing: CNG remains a cost-effective fuel, priced around 46% lower than petrol and 15% cheaper than diesel.

Challenges in APM Allocation and Pricing

• Gujarat Gas faced a 45% shortfall in APM gas allocation in Q3 FY25, impacting domestic and CNG supply.
• Due to rising LNG prices (up over 20% since September 2024), the company raised industrial gas prices by about ₹2 per SCM.
• Geopolitical issues are expected to keep natural gas prices high in Q4, affecting its competitiveness against alternative fuels.

Sustainability and ESG Initiatives

GGL is actively working on environmental, social, and governance (ESG) initiatives:

• Hydrogen Blending: The company completed an 8% hydrogen blending pilot and is aiming for 15% blending after regulatory approvals.
• Reducing Coal and Petrol Use: Daily coal consumption has been cut by about 13,000 metric tons, while petrol combustion has been reduced by 3,084 kiloliters through increased CNG adoption.

Future Strategy and Expansion Plans

GGL is focused on expanding its customer base and infrastructure:

• Over 22.28 lakh domestic connections were added in the latest quarter.
• More than 50 agreements have been signed under the FDODO (Franchisee Dealer Owned Dealer Operated) model.
• The company has allocated ₹1,000 crores for capital expenditure in FY26 to support further growth.

Key Challenges and Outlook

• Supply Challenges: Uncertainty in APM allocation affects domestic and CNG supply.
• Industrial Competition: Propane prices and global conditions could influence industrial gas sales.
• Contract Renewals: Management is actively working to replace expiring contracts and secure long-term agreements to ensure steady gas sourcing.

Gujarat Gas Limited continues to expand its infrastructure and maintain growth despite challenges in pricing and gas supply. With ongoing investments in ESG initiatives and a strong focus on customer expansion, the company is well-positioned for long-term success in the natural gas market.

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