Gujarat Gas Ltd Share Price – NSE /  BSE

Gas Distribution, Small Cap

However, revenue from operations declined 1.66% YoY to Rs 3,781.75 crore in the quarter ended 30 September 2024.

Profit before tax stood at Rs 415.22 crore in Q2 FY25, registering a growth of 3.62% on YoY basis.

For the quarter ended 30 September 2024, the company's sales volumes were 8.75 mmscmd, compared to 9.32 mmscmd in the corresponding quarter of the previous year.

The compressed natural gas (CNG) category continued to witness strong momentum, as the consumers are benefitting from favourable government policies which has supported in terms of volume growth.

The company recorded CNG sales of 2.93 mmscmd for the quarter ended 30 September 2024, marking a growth of 11.83% YoY.

PNG domestic and commercial sales volumes during the period under review aggregated to 0.76 mmscmd (up 8.57% YoY) and 0.15 mmscmd (up 7.14% YoY), respectively.

During the quarter, the company added more than 38,500 new domestic customers and 9 new CNG stations. Volume of around 88,000 scmd was added due to commissioning of new industrial customers. As of 30 September 2024, the company has signed volume of approximately 5,27,000 scmd to be commissioned soon.

Gujarat Gas is the largest city gas distribution company in India. The company has a network of about 41,700 km of gas pipeline, distributing approximately 8.75 mmscmd of natural gas. The company operates more than 820 CNG stations and has connected more than 21.91 lakh households in six states and one union territory.

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Net profit of Gujarat Gas rose 4.22% to Rs 308.74 crore in the quarter ended September 2024 as against Rs 296.25 crore during the previous quarter ended September 2023. Sales declined 1.66% to Rs 3781.75 crore in the quarter ended September 2024 as against Rs 3845.40 crore during the previous quarter ended September 2023.

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Gujarat Gas will hold a meeting of the Board of Directors of the Company on 6 November 2024

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CRISIL Ratings stated that the rating action follows the recent announcement by the company on the scheme of amalgamation announced by the parent companies of GGL – Gujarat State Petroleum Corporation (GSPC) and Gujarat State Petronet Limited (GSPL).

As per the announcement, GSPC and GSPL are to be merged into GGL. However, the gas transmission business will subsequently be carved out and listed as a separate entity, GSPL Transmission Limited (GTL), which will not be a part of GGL, post successful completion of the scheme of arrangement.

The scheme has been approved by the board of the respective companies and is awaiting requisite regulatory and other approvals and could take 3-4 quarters for completion.

CRISIL Ratings notes that GSPC, which undertakes natural gas trading business, is the country’s second largest gas trading company and has healthy financial profile with nil debt since fiscal 2023.

However, CRISIL Ratings is yet to fully assess its credit profile and the potential impact of its merger with GGL, as some of the critical information related to GSPC’s business is awaited. Timely receipt of the required information as well clarity on other important business and financial parameters will be important for resolution of the rating watch.

Furthermore, CRISIL Ratings understands that there is a high likelihood of successful completion of the scheme of amalgamation given the potential synergy benefits and valuation gains for the shareholders. However, further developments on the merger process will be monitorable.

The rating by CRISIL Ratings on the bank facilities of GGL continues to reflect strong financial risk profile, backed by healthy cash accrual and negligible reliance on external debt. The rating also derives comfort from the company's sizeable scale of operations as the largest city gas distribution (CGD) entity in India.

These rating strengths are however partially offset by its exposure to volatility in re-gasified liquefied natural gas (R-LNG) and domestic natural gas prices, risk related to setting up CGD networks in the newer geographical areas (GAs) in a timely and cost-efficient manner and exposure to regulatory risks.

Gujarat Gas is India's largest CGD company by gas sales volume. It has 27 CGD licenses spread across 44 districts in 6 states and 1 union territory across Gujarat, Maharashtra, Rajasthan, Haryana, Punjab and Madhya Pradesh and Union Territory of Dadra & Nagar Haveli.

The scrip slipped 1.86% to currently trade at Rs 642 on the BSE.

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