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Informist, Monday, Jul. 28, 2025

By Anand JC

NEW DELHI – GAIL (India) Ltd.'s bottom line for the June quarter registered the biggest on-year decline since the first quarter of 2023-24 (Apr-Mar) on the back of a weak revenue growth and an increase in costs.

GAIL reported a net profit of INR 18.9 billion for the reporting quarter, nearly 31% lower on year. This is also lower than consensus net profit estimates of INR 19.7 billion.

Its revenue for the quarter was INR 347.7 billion, registering a moderate 3% on-year growth. However, unlike the bottom line, GAIL's revenue exceeded the Street's expectation of INR 345.5 billion. 

GAIL's revenue from natural gas transmission services contracted 2% on year to INR 28.1 billion while earnings from liquefied petroleum gas transmission services grew nearly 26% to INR 2.3 billion in the June quarter. Revenue from the natural gas marketing segment, which contributed over 80% to its total revenue, grew just over 5% on year to INR 310 billion in Apr-Jun.  

Earnings from its petrochemicals business for the reporting quarter were INR 16.8 billion, increasing only over 3% on year. Revenue from LPG and liquid hydrocarbons business was INR 11.1 billion, down over 5% on year. GAIL's other income fell over 21% to INR 2.9 billion in the reporting quarter, marking the third consecutive quarter of contraction year-on-year.

SEGMENTAL PERFORMANCE

The company's natural gas transmission in the June quarter was 121 million standard cubic meters per day. In the reporting quarter, marketed natural gas, totalling 105 mscmd, it said in an investor presentation.

Its petrochemical sales during the quarter under review stood at 177,000 tonnes. Liquid hydrocarbons sales during the same period were 198,000 tonnes and LPG transmission was 1.1 million tonnes.

EXPENSES

The gas distributor's overall expenses for the June quarter were INR 325.3 billion, up nearly 7% on year. Expenses incurred towards purchase of stock-in-trade constituted the highest chunk of the overall expenses pie, rising nearly 5% on year to INR 263.6 billion. Other expenses increased nearly 14% on year to INR 18.6 billion and the cost of materials consumed grew 23% to INR 17.5 billion. 

Tax expenses fell almost 30% on year to INR 6.5 billion in Apr-Jun. 

GAIL's gross earnings before interest, taxes, depreciation, and amortisation for the quarter was INR 36.3 billion in the June quarter. Its operating margin stood at 7.1% for the reporting quarter, compared to 10.4% a year ago.

The company has planned to incur a capital expenditure of INR 107 billion in the ongoing financial year, compared to INR 105.1 in FY25. During the June quarter, the company incurred a capital expenditure of INR 31.8 billion, mainly on pipelines, petrochemicals, equity contribution to its joint ventures, and others.

Its Jamnagar-Loni LPG pipeline has received the Petroleum and Natural Gas Regulatory Board's authorisation for capacity expansion to 6.5 million tonnes per annum from 3.25 million tonnes per annum. This capacity expansion would take three years to complete at an estimated capital expenditure of INR 50 billion, the company said in a press release.

GAIL detailed its financials after the market hours. On Monday, its shares ended at INR 180.63 on the National Stock Exchange, down 1.6% from the previous close.   End

Edited by Tanima Banerjee

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