Volume growth held, but profit tanked YoY; macro crisis stalls margin upside

3.496 mmscmd vs 3.185 mmscmd prior year; 9.74% growth confirmed

Delivered result shows ₹192.6 Cr (call figure ₹194 Cr is rounding)

Q4 ₹132 Cr → Q1 ₹192.6 Cr = 46% growth; confirmed

4.766 vs 4.456 mmscmd = 7% growth; matches stated despite -7.15% I&C decline

INR27-32/cubic meter increase; Brent ₹95-100 vs ₹62-63 prior quarter; math checks out

Prior call noted 'above INR8/scm'; current call states 'INR8 to INR9 per SCM'. Same intended level.

Q1 achieved 9.74% CNG growth; guidance of 8-9% is LOWER than prior 'double-digit' aspirations

Prior call (FY26): 'double-digit' CNG growth aspired. Q1 FY27 call: 'growth should be in range 8-9%' due to gas supply curtailment from West Asia crisis.

PNG Drive 2.0 enabling record 95k domestic conversions in Q1 (vs historical ~1,500-2,000/day). Capex front-loaded to seize government-backed LPG-to-PNG shift.

Government directive enforced in Q1; pooled gas discontinued after July 4 due to Hormuz Strait impact. I&C sales down 7.15% YoY despite demand.

Prior call: 'above INR8/scm'. Current: 'INR8 to INR9 per SCM'. Range slightly widened but core target same; acknowledges volatility.

APM ~30%, NWG/pooled ~21-22%, HPHT 14-15%, Henry Hub ~21-22%, spot minimal. Spot touched $20/MMBtu; pooled gas in $12.5-13 range.

Q4 was abnormally low (Brent $62-63); Q1 was abnormally high ($95-100 Brent). Realization increase was INR27-32/m³ (~70-80% YoY). Acknowledged unsustainability; margin is 'balancing act' between CNG and I&C, linked to Brent vs Henry Hub spread.

Very difficult to call. Gas cost could be 'out of control.' Margin 'definitely under pressure for at least 1-2 months.' Company is managing weighted average gas costs but can't guide.

Growth driven by cumulative vehicle base (1.31M total) and stations added in past 2 years, not just Q1 additions (26k). Monsoon traffic also boosted consumption. Did not provide breakup.

Assuming prices stabilize and cost structure normalizes, 8-9% CNG growth expected. Industrial/commercial would be 12-14% if not for gas curtailments. Noted that gas supply is bottleneck, not demand.

No. Acknowledged Q1 margins 'slightly abnormal' due to both high Henry Hub (input cost low) and high Brent (realization high). Over longer tenure, margins balance; Q4 was opposite (low Brent, high Henry Hub). Cannot sustain Q1 levels.

STU buses may go EV (funded by govt), but private buses won't due to capital cost and lack of financing. STU losses (BEST, MSRTC) being offset by private bus adoption; program launched to grow fleet. Buses = 4-5% of total CNG volume.

Maintaining 40-45% price discount to petrol and ~12% to diesel. Will not change prices frequently (volatility bad for fleet adoption). For permanent basis, if petrol/diesel rise, will recover gas cost.

Zero-debt company; prepared to raise debt. Have balance sheet surplus. CBG plants also need capital. No issue raising debt if required.

Pooled gas discontinued after July 4 when government withdrew priority mechanism. Henry Hub force majeure triggered again due to US-Iran escalation (after brief normalization). Company not receiving full Henry Hub quota; buying spot for 2-3 weeks. Situation 'worse than Q1.'

Endeavor to do maximum. Current rate ~1,000/day; could hit 2,000-3,000/day if no bottlenecks. Target 8-10 lakh for FY27 (vs ~2.17M cumulative as of Q1-end). Limited by plumber/engineer/meter/pipe availability; currently monsoon.

DPNG growth limited by household penetration (3.3M connected, 2.3M consuming out of 3.8-4M potential). Can tap 50-60% of unburning customers due to govt pressure (LPG cylinder ban threat). If all connected, growth could hit 7-8% instead of 5-6%. Beyond that, needs new geographies.

Last call said double-digit 'if' CNG hits 8-9% and I&C hits 12-14%. With gas supply curtailment, both are now at risk. INR8-9 EBITDA/scm is 'over longer period' under normal circumstances. Today, circumstances are abnormal; nobody can predict spot or gas availability.

8-9% range.

No impact. Dividend will be maintained and gradually increased. Capex is only front-loading; total project-to-tap-potential spend same. Balance sheet can support debt if needed.

Long-haul LNG 2 stations, 5 tons/day, breaking even (consolidation difference). Battery on hold; per-kWh realization fell $100+ to $70-75; restructuring project. EV 3-wheeler start-up, not yet profitable but sector challenges. CBG plant agreed with MCGM, 350 ton/day phase 1 soon. Most are early-stage; no material near-term revenue.

No plan to bid. Existing GAs (GA-1, GA-2, GA-3, UEPL SBUs) have ample headroom. UEPL SBUs can grow 4x from current 0.3 mmscmd to 1.2 mmscmd. Will consider acquisitions if APM allocation declines and distressed sellers appear.

Guidance assumes prices stabilize and West Asia crisis resolved within 1-2 months. Implied FY27 revenue growth 8-10% at blended realization; highly sensitive to Brent/HH spread.

Management explicitly stated INR8-9/scm target 'over longer period of time and under normal circumstances.' Acknowledged Q1 is abnormal and unsustainable. Margin volatility expected near-term due to West Asia crisis.

Driven by PNG Drive 2.0 acceleration; record Q1 connections (95k) validate rapid scaling. Subject to manpower and material availability bottlenecks; management confident will execute.

Ongoing West Asia crisis has halted pooled gas (discontinued July 4), triggered Henry Hub force majeure post-July, and constrained RLNG imports. Government imposed 20% allocation cut on I&C segment. Crisis described as 'worse than Q1' by end of July.

Q1 NPM 7.3% benefited from abnormal Brent spike (₹95-100) and low Henry Hub ($12.5-13). Management states this is 'slightly abnormal' and not sustainable. If Brent normalizes to ₹62-63 (as in Q4) and Henry Hub rises, margins will compress materially. CNG pricing constrained by petrol/diesel competitive ceiling.

Prior call aspired to 'double-digit' volume growth in FY27. Q1 call guides only 8-9% CNG and 12-14% I&C (latter only if crisis resolves). Gas curtailment (20% on I&C) is now the bottleneck, not demand. I&C sales fell -7.15% YoY despite 'lot of demand.'

Company planning to raise debt for first time to finance PNG Drive 2.0 capex. While balance sheet is strong, debt would mark a strategic shift. Execution risk on capex absorption (plumber, engineer, meter, pipe bottlenecks cited).

CNG buses (6k units) are 4-5% of total CNG volume. Government may push EV adoption for STU buses. Company launched 'fleet program' for private buses and signed MOUs. But EV transition is 10-15 year risk, not immediate.