Adani-Total Gas net profit falls 17 pc on APM gas supply cuts

New Delhi, Jan 27 (PTI) Adani Total Gas Ltd, the city gas joint venture of Adani Group and TotalEnergies of France, on Monday reported a 17 per cent drop in its third-quarter net profit as the company replaced a cut in cheaper domestic input gas supplies with higher priced fuel.
     Net profit of Rs 143 crore in October-December - the third quarter of April 2024 to March 2025 fiscal (FY25) - compared with Rs 172 crore earning in the same period last year, according to a company statement.
     During the quarter, supplies of regulated gas, called APM gas, for CNG segment met only 47 per cent of the demand and the balance was met with higher-priced gas.
     "ATGL 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 gas with other sources, the gas cost has increased, which has impacted the quarter profitability," it said.
     In October and November last year, the government cut supplies of APM gas to city gas retailers - who retail CNG to automobiles and piped cooking gas to households - in view of limited domestic output. The supplies were partly restored this month.
     Besides higher volume, with lower allocation of APM gas to CNG segment coupled with higher price of imported gas due to winter, the cost of natural gas rose by 20 per cent, it said.
     "EBITDA was adversely impacted due to higher gas costs. Quarterly EBIDTA declined 10 per cent year-on-year to Rs 272 crore," the statement said. "Profit before tax and profit after tax declined by 17 per cent on account of increased depreciation due to expanding asset base."
     ATGL said CNG stations increased to 605 with the addition of 28 new stations. Piped natural gas home connections increased by 28,677 to 9.22 lakh while industrial and commercial connections rose to 8,913 with 167 new consumers added.
     The company recorded a 15 per cent rise in CNG and piped natural gas sales at 257 million standard cubic meters in Q3.
     "As earlier notified by the company, during the quarter under-reporting APM allocation of natural gas for CNG segment was reduced impacting the profitability as company had to bridge the shortfall with costlier purchase of natural gas to ensure uninterrupted supply of CNG to end consumers. This allocation was reduced for the entire CGD sector," it said.
     For ATGL, the allocation of APM gas for CNG segment was reduced from 63 per cent of total demand to 51 per cent from October 16, 2024, and then further from 51 per cent to 37 per cent effective November 16, 2024.
"Taking the above reductions into account, the average supply of APM-based natural gas for CNG segment during the quarter was at 47 per cent."
     Recently, with effect from January 16, 2025, APM allocation of natural gas for CNG has increased from 37 per cent to 51 per cent. "As already notified by the company, this would have a positive impact for the next quarter," the statement added.

(This story has not been edited by THE WEEK and is auto-generated from PTI)