Earnings Review
Adani Total Gas PAT up 7% on year, lowest growth in 8 qtrs
This story was originally published at 20:06 IST on 24 October 2024
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--Adani Total Jul-Sept natural gas costs at INR 8.71 bln, up 12% YoY
--Adani Total added 204 new commercial, industry users in Jul-Sept
--Adani Total added 34,468 new residential PNG connections in Jul-Sept
--Adani Total Jul-Sept PNG sales 80 mscm, up 7% on year
--Adani Total added 18 new CNG stations in Jul-Sept, total now 577
--Adani Total Jul-Sept EBITDA INR 3.13 bln, up 8% on year
--Adani Total Jul-Sept CNG sales at 162 mscm, up 19% on year
--Adani Total shares at INR 739, up INR 38.55 or 5.5%
--Adani Total Apr-Sept consol revenue INR 25.57 bln vs INR 23.14 bln yr ago
--Adani Total Apr-Sept consol net profit INR 3.57 bln vs INR 3.23 bln yr ago
--Adani Total Jul-Sept consol net profit INR 1.86 bln vs INR 1.73 bln yr ago
--Adani Total Jul-Sept consol revenue INR 13.18 bln vs INR 11.79 bln year ago
--Adani Total Jul-Sept consol net profit INR 1.86 bln vs INR 1.73 bln year
By Sunil Raghu
AHMEDABAD - Adani Total Gas Ltd. reported a 7.5% year-on-year rise in its consolidated net profit in the September quarter, the lowest growth in eight quarters. The net profit of the company rose to INR 1.86 billion in Jul-Sept from 1.73 billion a year ago. Sequentially, the net profit rose 8.0%.
The consolidated revenue from operations rose 11.8% on year to INR 13.18 billion on the back of higher natural gas sales from its rising network of compressed natural gas stations and relatively stable natural gas prices. The stability in prices has led to an increase in the consumption of piped natural gas by Adani Total's industrial consumers, the company said.
The government-fixed prices for domestically produced natural gas for city gas distributors, which ranged from $8.38 per million British thermal units to $8.90/nBtu in Apr-Jun, fell to $7.85/mBtu-$8.51/mBtu in Jul-Sept. The city gas distribution companies get allocation of natural gas from government fields to a large extent, but they need to fill the gap by sourcing additional gas from other sources, including deepwater fields or Liquefied Natural Gas from global markets.
The natural gas costs of Adani Total rose 12% on year to INR 8.71 billion in Jul-Sept. The cost of natural gas and trading during the September quarter rose 11.9% to INR 7.74 billion. Sequentially, it rose 8.8%.
The total expenditure of the company in Jul-Sept rose 12.8% on year to INR 10.87 billion.
The company's earnings before interest, taxation, depreciation and amortisation rose 8% on year to INR 3.13 billion, supported by volume growth due to infrastructure expansion and operational efficiency, the company said in its press release.
OPERATIONAL UPDATES
During the September quarter, the company's gas volumes rose 15% on year to 242 million standard cubic meters. Of this, CNG sales increased 19% to 162 mscm and piped natural gas sales rose 7% to 80 mscm. The CNG volumes rose on account of CNG network expansion across multiple geographical areas, while piped natural gas volumes rose due to recovery in industrial volumes and the addition of new domestic and industrial customers, the company said.
Adani Total added 18 new CNG stations in Jul-Sept, taking the total number of stations to 577. In piped natural gas, the company added 34,468 new residential connections and 204 new industrial and commercial connections in Jul-Sept.
Including the infrastructure and facilities of its joint venture company – Indian Oil Adani Gas Pvt Ltd – the total number of CNG stations was at 958, PNG home connections were at 1.06 million and industrial and commercial connections were at 9,719 at the end of Sept. 30, 2024.
The company has commissioned 1,486 electric vehicle charging points across 213 cities. It has also operationalised a hydrogen blending pilot program in Ahmedabad, which will be supplied to 4000 consumers. It also commissioned its first liquefied natural gas retail outlet at Tiruppur, with two more under construction at Dahej and Mundra in Gujarat.
During the September quarter, the company had secured funding of $375 million from a group of foreign banks for its city gas distribution business. This will help to fast-track the company's capital expenditure programme, enabling it to expand its city gas distribution network to 34 geographical areas across 13 states.
The government this month issued new guidelines for city gas distribution under which GAIL (India) Ltd. will procure and mix liquefied natural gas in the city gas distribution pool and supply it at a uniform base price to all city gas distribution entities. The 67% compressed natural gas that was being given to GAIL was brought down to 51%.
This means the city gas distributors will have to increase their dependence on costlier imported gas. This suggests that the retail price of compressed natural gas is likely to go up over the next few weeks unless the companies choose to absorb the hit on their margins.
Adani Total, which has already seen GAIL reducing domestic gas supply by 16%, Thursday reiterated that it would calibrate retail prices for end consumers to mitigate the impact and maintain uninterrupted supply to its customers.
On Thursday, shares of Adani Total Gas closed 7.8% higher at INR 754.95 on the National Stock Exchange.
End
Edited by Saji George Titus
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