MGL — earnings call
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Prepared remarks
Moderator · Conference Operator
MR. SABRI HAZARIKA – EMKAY GLOBAL FINANCIAL
SERVICES · Management
Mahanagar Gas Limited July 23, 2025
Moderator · Conference Operator
Ladies and gentlemen, good day, and welcome to Mahanagar Gas Limited Q1 FY'26 Earnings Conference Call, hosted by Emkay Global Financial Services Limited.
As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes.
Should you need assistance during the conference call please signal an operator by pressing “*” then “0” on your touchtone phone.
Please note that this conference is being recorded.
With this, I now hand the conference over to Mr. Sabri Hazarika.
Thank you, and over to you, sir.
Sabri Hazarika
On behalf of Emkay Global Financial Services, I welcome you all to the Q1 FY'26 Post Earnings Conference Call of Mahanagar Gas Limited.
We have with us the top management of the Company, led by Mr. Ashu Shinghal – Managing Director, Mr. Sanjay Shende – Deputy Managing Director, Mr. Rajesh Patel – Chief Financial Officer, and Mr. Rajesh Wagle – Senior Vice President (Marketing).
Today's session would be a brief on the results, followed by Question-and-Answer round.
Before we begin, I would like to mention that some of the statements made in today's discussion may be forward-looking in the nature and we believe that expectations contained in the statements are reasonable.
However, these statements involve a number of risks and uncertainties that may lead to different results.
We urge you to consider that quarterly numbers are not a reflection of long-term trends or indication of full year results.
With that said, I will now hand over the call to Management.
Over to you, sir.
Ashu Shinghal
A very good afternoon to you all and I welcome on behalf of MGL Management to the Earnings Call of Mahanagar Gas for the First Quarter for the financial year '25-26.
I would like to thank you all for attending the call today.
MGL continues to create CGD infrastructure across its business segments in the license area.
During this quarter, 16,348 domestic households were connected and thus, we have established connectivity for nearly 2.85 million households.
We have also laid 79.08 kilometers of steel and PE pipeline, taking the total length to over 7,538.63 kilometers.
We have 385 stations as on 30th June.
We also have added 84 industrial and commercial customers during this quarter, and therefore, as on 30th June, we have 5,161 industrial and commercial customers in total.
During this quarter, there is an addition of 20,332 CNG vehicles, and now we have more than 1.1 million CNG vehicles registered in our geographies.
Mahanagar Gas Limited July 23, 2025 With respect to Unison Enviro Private Limited, the wholly owned subsidiary, the Company has added 4 CNG stations during this quarter, and with this, it has 86 stations as on 30th June.
The Company has added 3,338 domestic households and have established connectivity for nearly 42,338 households and added one industrial customer during this quarter.
Thus, we have 63 industrial and commercial customers as on 30th June.
UEPL has laid 73.78 kilometers of steel and PE pipeline taking the total length to 435.56 kilometers.
There was an addition of 3,939 CNG vehicles in UEPL area during this quarter, and with this, now UEPL has nearly 57,537 CNG vehicles registered in its geography as of 30th June.
Coming to MGL's operation: Overall average gas sales of Q1 for the current financial year compared to the corresponding quarter of the previous year has increased to 4.229 mmscmd from 3.858 mmscmd, which is an increase of 9.61%.
Compared to Q1 of the current year, to the corresponding period of the previous year, sales volume in case of CNG has increased to 2.981 from 2.772 mmscmd, which is an increase of 7.54%.
Sales volume for the domestic CNG has increased to 0.569 mmscmd from 0.547 mmscmd, which is an increase of 3.88%.
In the case of industrial and commercial sales, commercial sales volume has increased to 0.679 mmscmd from 0.539 mmscmd, which is an increase of 26.09%.
During this quarter, we achieved overall average sales of 4.229 mmscmd as against 4.194 mmscmd in the previous quarter, which is an increase of 0.85%.
The current quarter volume consists of CNG volume of 2.981, and a domestic volume of 0.569, while 0.679 mmscmd of gas has been supplied to industrial and commercial segments.
EBITDA from operations for the quarter is INR485 crores as compared to previous quarter EBITDA of INR378 crores, which is an increase of 28%.
EBITDA excluding one-time trade margin reversal is INR373 crores and INR315 crores for the current quarter and Q4 of the previous year, respectively.
Net profit after tax for the quarter is INR324 crores as compared to previous quarter net profit after tax of INR252 crores which is an increase of 29%.
Moderator · Conference Operator
The next question comes from the line of Yogesh Patil from Dolat Capital.
Please go ahead.
Yogesh Patil
Thanks for taking my question, sir.
Sir, let me continue with Probal’s question.
If you could provide the detailed breakup of gas sourcing in mmscmd unit from each source like APM, NWG, HPHT, Henry Hub and any other we are taking it from the spot or IGX that would be really helpful?
You have already mentioned 0.5 mmscmd NWG.
Apart from that, if you could provide?
Moderator · Conference Operator
The next question comes from the line of Yash Nandwani from IIFL Capital.
Please go ahead.
Yash Nandwani
Thanks for the opportunity.
Sir, my first question is on the slowdown in the CNG volume growth.
We have seen about 10% growth or even higher in the last few quarters.
This quarter it has a little bit slowed down to 7.5%.
So, is it just because of the early monsoon or is there any other reason?
Moderator · Conference Operator
The next question comes from the line of Amit Murarka from Axis Capital.
Please go ahead.
Amit Murarka
Hi, thanks for the opportunity.
On UEPL, I think you had earlier mentioned that there will be some unabsorbed depreciation and tax losses, which would be available once the merger is done.
Could you quantify how much of that is?
Moderator · Conference Operator
The next question comes from the line of Varatharajan from Antique Limited.
Please go ahead.
Varatharajan
Thanks for the opportunity.
Sir, on the mix of volume in Zone 1 and Zone 2 transportation, so if you have a number to share?
Moderator · Conference Operator
The next question comes from the line of Maulik Patel from Equirus.
Please go ahead.
Maulik Patel
Just one thing on that JV which you made for the IBC, you mentioned that the total investment from your side will be close to around INR360 crores, right?
Moderator · Conference Operator
The next question comes from the line of Nitin Tiwari from PhillipCapital.
Please go ahead.
Nitin Tiwari
Hi, sir, thanks for the opportunity.
Just staying on the volume bit, so what is our current guidance for volume growth for FY'26 and '27 as a whole and also our guidance for margins?
And I also wanted to understand the margin perspective from the recent tariff reforms that PNGRB has notified which Mahanagar Gas Limited July 23, 2025 perhaps would lead to like, I mean, the applicability of Zone 1 tariff for CNG.
So, how do we see that impacting our margins if you can throw some light on that?
Moderator · Conference Operator
The next question comes from the line of Somaiah from Avendus Spark.
Please go ahead.
Somaiah
Sir, the first question is on the new well gas mix.
So, this 0.5 mmscmd is roughly around 15%, 16%.
So, is this the max that we can get or is it because our portfolio we already have HPHT and Henry Hub, so 15% is something that we have opted for?
Moderator · Conference Operator
The next question comes from the line of S.
Ramesh from Nirmal Bang.
Please go ahead.
S. Ramesh
Good evening and thank you very much.
So, if we were to look at the UEPL performance this quarter, can you just take us through the revenue, EBITDA and PAT?
And how do you see the UEPL volumes perform over FY'26-27 based on the CAPEX you are doing and the growth in the infrastructure?
Moderator · Conference Operator
The next question comes from the line of Mr. Arya Patel.
Please go ahead.
Arya Patel
I just had one question.
So, what was the average realization for industrial and commercial customers in Q1 as well as the average realization in FY'25 and Quarter 4 FY'25?
Moderator · Conference Operator
The next question comes from the line of Sagar Kapadia from Prabhudas Lilladher.
Sagar Kapadia
Sir, recently, we have read news that MSRTC is going to procure more of this hybrid CNG, LNG buses.
So, I wanted to know, earlier, we used to give figures how much conversions have been made from the MSRTC buses.
And also I would like to know in our geographical area, how many bus depots of MSRTC are there?
And what are the plans of MGL?
How many CNG stations can be established in those bus depots?
Moderator · Conference Operator
The next question comes from the line of Keshav from Kotak.
Keshav
Sir, can you please give us GA-wise volume breakup and the YoY growth rate?
Mahanagar Gas Limited July 23, 2025
Moderator · Conference Operator
Thank you.
The next question comes from the line of S.
Ramesh from Nirmal Bang.
S. Ramesh
As a follow-up to the question, so if I look at your overall business now in terms of the gas sourcing and the price increase required, what is the additional price increases required to improve margins?
And when do you think you will be able to do that?
And if you see gas prices remaining stable at these levels, do you see the operating leverage and volume growth helping you improve your EBITDA growth and earnings growth, say, over the next few quarters?
Moderator · Conference Operator
Ladies and gentlemen, we will take this as a last question for today.
I would now like to hand the conference over to the management for closing comments.
Managementl
I would like to thank once again all the investors for placing faith on the Mahanagar Gas and wish you all the best.
Thank you so much for joining in.
Moderator · Conference Operator
Thank you.
On behalf of Emkay Global Financial Services Limited, that concludes this conference.
Thank you all for joining us, and you may now disconnect your lines.
(This transcript has been edited, without altering the content, to ensure clarity and improve readability.) Mahanagar Gas Limited July 23, 2025
Registered Address
MGL House, G-33 Block, Bandra-Kurla Complex, Bandra (East), Mumbai – 400051, Maharashtra
Contact details
[identifier removed]
Website
www.mahanagargas.com
CIN
L40200MH1995PLC088133
Questions and answers
Coming to UEPL Operations
During the quarter, the Company has achieved an overall average sales volume of 0.225 mmscmd as against 0.208 mmscmd in the previous quarter, which is an increase of 8.55%.
Current quarter volume consists of CNG volume of 0.204 and PNG volume of 0.021 mmscmd.
Mahanagar Gas Limited July 23, 2025 Compared to the previous quarter, sales volume in case of CNG has increased to 0.204 mmscmd from 0.189 mmscmd, which is an increase of 7.94%.
For the quarter ended this 30th June, MGL's consolidated entity has achieved total gas volumes sale of 4.455 mmscmd.
A scheme of amalgamation of UEPL with MGL was filed with NCLT in December '24.
The NCLT has approved the scheme of amalgamation and pronounced its final order on 9th July with February 1, 2024 as appointed date of amalgamation.
The scheme will become effective upon filing of the certified copy of NCLT order with the ROC, Maharashtra.
MGL has entered into an MoU with BMC for setting up of a CBG plant in Mumbai.
During this quarter, the government of Maharashtra has approved the leasing of land to MGL at Deonar, Mumbai, for setting this plant.
With this, I conclude, and would now like to open the floor for questions.
Thank you very much for your patience.
Moderator · Conference Operator
We will now begin the question-and-answer session.
The first question comes from the line of Probal Sen from ICICI Securities.
Please go ahead.
Probal Sen
Thank you for the opportunity, sir.
Congrats on a strong set of numbers.
Two questions.
One was that in this quarter, what was the sort of APM net allocation that we saw excluding new well gas, what is the exact percentage that we got for our priority segments?
Number one.
Second question was this amalgamation scheme, now that it has been approved, when can we sort of tentatively expect the full consolidated numbers to be available or rather be reported by MGL?
And third, if you can give us some color on the CAPEX for the next couple of years, including on the CBG as well as on the battery venture and on our core business?
Those are my three questions, sir.