Adani Total Gas Q3 profit dips 19.4% despite volume growth, revenue rise

Adani Total Gas Ltd (ATGL), a gas supplier for the Adani Group, reported a 19.4% decline in its Q3 FY25 profit, which dropped to ₹142.38 crore from ₹176.64 crore in the same period last year, according to an exchange filing. The company’s consolidated revenue for the quarter increased by 12.6%, reaching ₹1,400.88 crore, up from ₹1,244 crore in Q3 FY24.

Explaining the reasons behind a drop in Q3 profitability, ATGL, in its filing, says the company took a "balanced approach" in passing the higher gas cost to ensure volume growth does not get impacted, but due to the replacement of APM (administered pricing mechanism) gas with other sources, the gas cost has increased, which has impacted the quarter profitability.

The company's Q3 EBITDA was also adversely impacted due to "higher gas costs" at ₹272 crore, down 10% YoY.

In terms of operations, ATGL says it has launched a doorstep customer delight program to provide a delightful experience to its customers at their doorstep. In Q3, ATGL’s DJSI (Dow Jones Sustainability Indices) net ESG (environmental, social, and governance) score improved to 62 from 54, which positioned in the 80th percentile amongst the 143 companies, says the company.

"ATGL maintained its growth trajectory, with a notable 15% year-on-year increase in volume. Despite the reduced APM gas allocation, Team ATGL ensured an uninterrupted supply of CNG to our large masses of consumers by sourcing additional the supplies of gas through alternative options. The key to us is to calibrate the end prices balancing the affordability of end consumers and other stakeholders including the profitability of the Company which is evident from our growth in the volumes of 15% and EBITDA growth of 6% for 9 months period on a YoY basis. We are striving to further accelerate development of PNG and CNG infrastructure across our 34 GAs, including the recently added Jalandhar GA in Punjab,” says Suresh P Manglani, ED & CEO, ATGL.

Regarding infrastructure and operations, Adani Total Gas crossed 600 CNG stations to reach 605 CNG stations across 34 geographical areas. Over 9 lakh homes are now connected with piped natural gas 53. CNG volume increased by 19% YoY on account of CNG network expansion across multiple geographical areas (GAs), says the company, adding that with the addition of new PNG connections, PNG volume increased by 8% Y-o-Y and overall volume surged 15% YoY.

Considering the above reductions, the average supply of APM-based natural gas for the CNG (T) segment during the quarter was 47%. "As stated, the shortfall was met through supplies under the existing contracts, allocation of natural gas under new well gas pricing mechanism and by ways of purchase through IGX gas exchange, ensuring uninterrupted supply. Recently, with effect from 16th January 2025, APM allocation of natural gas for CNG (T) has increased from 37% to 51%. As already notified by the Company, this would have a positive impact on the next quarter."

Amid the Q3 quarterly results, Adani Total Gas shares are trading at ₹617.95 on the BSE, down 3.72% (3.16 pm).