Mahanagar Gas Limited (MGL) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Mahanagar Gas Ltd.

Q4 FY26 Earning Conference Call hosted by Ilara Securities. As a reminder, all participant lines will be listened 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 star, then zero on your touchtone phone.

Please note that this conference has been recorded. I now hand the conference over to Mr. Gagan Dixit. Thank you and thank you, sir.

Yes, thank you. A very warm welcome to everyone to discuss Mahanagar Gai's Q4-FI-26. It is our pleasure to be able to bring to you the management of Mahanagar Gai, led by Mr. Praveen Kumar Shattop, Managing Director, Mr. Ajay Sina, Jeepti Managing Director, Mr. Ragesh Patel, Chief Financial Officer, and Mr. Ragesh Vagli, Senior Vice President, Marketing. So, with these words, I will now hand over the conference to the Mahanagar guest management. Over to you, sir.

A very good afternoon and welcome to the earnings call of Mahanagar Gas Limited for the fourth quarter of the financial year 2025-2026. I would like to thank you all for attending our earnings call today. Due to the supply disruptions arising from the recent ongoing geopolitical crisis in Iran and wider Gulf region, which has adversely impacted LNG facilities and created significant challenges in the global LNG supply chain, particularly cargos routed through the Strait of Hormuz, our 100% DPNG and major part of DNG requirement is supported by domestically produced gas, ensuring 100% supply to these customers. Gas supplies to industrial and commercial customers is partly curtailed. Prices may be affected due to global indices in the near term. However, they are expected to improve over time. MGL continues to create TGD infrastructure across its business segments in the licensed area. During the quarter, 143,997 domestic households were connected, and thus, we have established connectivity for nearly 3.21 million households. We have laid 138.48 kilometers of field and PEE pipelines, taking the total length to over 8,320.43 kilometers. We added 28 CNG stations during this quarter. And with this, we have 518 stations as on 31st March, 2026. We added 334 industrial and commercial customers during this quarter. As on 31st March, 2026, we have 5,924 industrial and commercial customers. During this quarter, there is an addition of 34,854 CNG vehicles, and now we have more than... 1.28 million CNG vehicles registered in our geographies as of 31st March, 2026. During the year, 3,42,157 domestic households were connected, and thus, the company have established connectivity for nearly 3.21 million households. We have laid 499 kilometers of steel and PE pipelines, taking the total length to over 8,320 kilometers. We also added 52 CNG stations during the year. And with this, we have 580 stations as on 31st March 2026. We also have added 872 industrial and commercial customers during the year. And therefore, as on 31st March 2026, we have 5,924 industrial and commercial customers. We have added 1,18,590 vehicles during the year, and the total vehicle as on March 31st, 2026 is 12,84,828. Coming to MGS operation during the quarter, we achieved overall average sales volume of 4.672. MMSCMD has gained 4.620 MMSCMD in the previous quarter, which is an increase in 1.12%. Current quarter volumes consist of CNG volume of 3.349 MMSCMD, DPNG volume of 0.605 MMSCMD, and 0.719 MMSCMD of gas was supplied to the industrial and commercial customers. Compared to the corresponding quarter of last year, average overall sales volume has increased from 4.402 to 4.672 mm SCMD, which is an increase of 6.15%. Sales volume of TNG has increased from 3.125 mm SCMD to 3.349 mm SCMD, which is an increase of 7.12%. Sales for domestic DPNG have increased from 0.591 MMSEMD to 0.605 MMSEMD, which is an increase of 2.24%. In case of industrial and commercial, sales volume has increased from 0.686 MMSEMD to 0.719 MMSEMD, an increase of 4.87%. Average gas sales for the current year ending 31st March 26th is 4.585 MMSCMD, whereas it was 4.235 MMSCMD last financial year, which is an increase of 8.25%. Sales volume in the case of CMG has also increased from 3.047 MMSCMD to 3.67 MMSCMD, which is an increase of 7.2% volume. Volume for domestic PNG has increased from 0.556 to 0.590 MMSEMD, which is an increase of 6.14%. And in case of industrial and commercial, the volume has increased from 0.632 to 0.727 MMSEMD, which is an increase of 15.04%. RLNG supplies are disrupted due to West Asia crisis and hence supply to industrial and commercial customers is curtailed to approximately 80% as per directives time to time impacting the volumes adversely. Due to major impact of supply of LPG due to the crisis, government has taken all measures. At the central and state level to push faster adoption of PNG. And this is a very positive move for the CGT sector. In the long run, an MGL is going to seize this opportunity to roll out infrastructure and increase its volume. Net profit after tax for this quarter is Rs. 132 crores as compared to the previous quarter. Net profit after tax of Rs. 202 crores. EBITDA from operations for the financial year 2025-2026 is Rs. 1,451 crores compared to previous financial year EBITDA of Rs. 1,570 crores. Net profit after tax for FY 2025-26 is Rs. 847 crores compared to net profit after tax for the previous financial year of Rs. 1,041 crores. I am happy to announce that Board has approved a final dividend subject to the approval of shareholders at the AGM at the rate of 180%, i.e. Rs. 18 per equity share for the current financial year. Thus, including interim dividend already paid at the rate of Rs. 12, total dividend is Rs. 30 per share for the financial year 2025-26. With this, I conclude and would now like to open the floor for the questions. Thank you very much for the patience.

Thank you. We will now begin the question and answer session. Anyone who wishes to ask questions may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Prabhal, from ICICI Securities. Please go ahead.

Thank you. Good afternoon, sir. I hope I'm all good.

Yeah, you are audible. Please go ahead, Prabhu.

Sir, yes, a few questions. Firstly, with respect to the supply disruptions, we understand from Petronet LNG also that the hedge utilization slipped to about 53% in March versus about 108% average on Jan Fed. So, in terms of our business, sir, did we also see this much of volatility in terms of our gathering, especially in March? Can we just get a sense of how the business was?

As I think MD already said in his opening remarks, as far as domestic PNG and CNG is concerned, 100% supply has been insured because mostly 100% of the domestic PNG is through APM, which is locally produced. As far as CNG is concerned, it is also majorities out of domestically produced, and balance was assured through cooled gas mechanism, which was announced somewhere around 9th of March. As far as industrial and commercial customer category has been concerned, roughly, you know, 80% supply was maintained, containing around 20%, within which probably some time-to-time directives have changed to ensure that, you know, small commercial restaurants, schools, colleges, crematorium, etc., should be supplied 100%, and wherever large industrial customers who can afford to, you know, switch to either alternate fuels or who can afford to pay higher market price prevailing at that time, Can be given. So overall, there was not much of an impact. Maybe after 9th of March, there were two, three days which were holidays, so there was no practical impact. But second fortnight, maybe...

Overall, in the month of March, we lost about 1.25, 1.3 lakhs CMD out of, let's say, a Feb average of 5.75. About 20-22% volume we lost.

This is in case of industry?

This is in industry?

Industry, excluding the commercial.

Commercial, we managed to maintain supplies because many of them were going to critical customers, hospitals, canteens. Masses of, you know, government institutions, schools, etc. Right, right. It was a large industry where the supply was curtailed of it.

So, sir, is it, if I, sorry, sorry if I go ahead.

However, it was ready to take, you know, at the prevailing price, that also we have given, but under the normal, this, we, we curtailed the supply to around 80%.

Yes, there were some 10 or 12 customers, industrial customers. For example, gas supply was very critical. They had requested us for, you know, you source any market price gas, we are okay. So, for them, we managed to source a small volume separately, and, you know, that they off to get a premium.

Got it. So, sir, is it fair to assume that April may have seen similar kind of volume and supply levels that we are seeing now, or has there been any change in the environment?

April is more or less similar as far as industry goes. Let's see, they have just started, but we are expecting maybe some small improvement to happen.

Got it. The second question, sir, was with respect to sourcing links. So, you already mentioned about domestic PNG and, of course, most of CNG. But if I can just get a little bit of granularity out of the 4.7 mm SCMD total sales. Is it possible to sort of split out how much of, let's say, domestic, I mean, APM, and how much of NG Hub link, and how much of spot we sort of sourced it from for this quarter?

So, APM, which is anyway available 100% for domestic PNG, as well as including CNG was in the range of around 1.6 MMS CMD. NWG and pooled gas is another 0.73 or 0.75. HPST, we could source, apart from the term contract, maybe through exchange, etc., which was in the range of around 0.9. HH, this I'm talking about March only, very specifically, not quarter.

Okay, March only. Got it. Okay.

Because there was a disruption only in March, okay? HH was curtailed to a slightly lower level, maybe, you know, to 50% of our 1.5 contracted quantity. And we had to rely for some quantity on spot as well. If you wish to know specifically for the quarter, Maybe, you know, apart from small amount of, because it will get averaged out. So, small amount of pool gas was there.

So, I think this march is useful, sir. March is useful, because that will probably be the sort of template for Q1, from what I understand is the situation process. This is very useful.

Yeah, but, you know, the pooled and NWG quantities are, you know, depending on availability has been changing. So, I'm really not able to, you know, give you any clue that the same level will continue in April or May. Because depending on the availability of gas, how things move, how the supplies, you know, come from gas, this will keep on changing. And we have to leave this time in uncertainty.

Right, sir. One last question, if I may. Any price changes and results on the CNG front in going forward? Is this something that we are looking at?

We have already taken a price increase on 22nd of April, 1 rupee, okay? And let us see how does, you know, alternate fuel prices move specifically for CNG since you asked. We will take a call, and definitely... We can sustain for, you know, some time the higher cost, but, you know, if it is slightly longer or it sustains for a longer time, we will be considering appropriate price rise in CNG as well as in domestic CNG if required. And compared to probably last quarter, definitely because of the Brent linked alternate fuels are already high, there is an improvement in the realization on IMC sector. Because we follow alternate fuel link pricing.

Right. Right. Perfect, sir. That is extremely useful. Thank you so much for your time. I'll come back.

Thank you. A reminder to all participants that you may press star and want to ask questions. The next question is from the line of Yogesh Patil from Dollars Capital. Please go ahead.

Thanks for an opportunity, sir.

Sir, just continue with the previous participant question.

APM, HPHT, NWG, HH, if we add up all them, it is giving closer to 4mm SCMD only. So, remaining was a spot. Is it a correct understanding?

We did sign some of the term contracts in the beginning of Jan. Some is also signed during April, okay? But due to the disruption, the quantity may not come fully. Your understanding is correct, but spot is likely to be in the range of, you know, 0.4 or so, not 0.7 as you are expecting.

Okay, fair enough, sir. Sir, recent price hikes in a DPNG and the CNG. So, how much percentage it has covered up the increase in gas cost of the last two months? Any broader idea if you could give us? Last two months? Yeah, I mean, we have seen the gas cost has gone up from March and April only, if I'm not wrong. And we have taken DPNG and the CNG price hikes in the month of April. So, just wanted to understand how much percentage of that increase in gas cost we have already covered up or the burden has already passed on to the consumer and the partial burden we have taken up. Any probable number if you could share.

See, if you consider, you know, domestic PNG, as you know, it is 100% through APM supplies, and there is a 25-cent increase from 1st of April linked to this whatever Kirikparek committee circular, okay? So, 25 cents plus there is an upside in the cost due to exchange rate. So, considering both this, we have taken a hike of one and a half rupee on 22nd April, 2026. Before that also, there was some hike, but a little earlier than this. So, that more or less covers, you know, the DPNG increase. We also consider that, okay, for some time, exchange rate had spiked, but it could stabilize. So we didn't want it to take a complete hit, and we will watch out further. How does exchange rate move from here? As far as CNG is concerned, I think you can understand that it's a temporary volatile situation, so there could be increasing the gas cost, but as far as pricing is concerned, we would prefer to keep it in a stable manner, and we might absorb, you know, this short-term volatility, and if it does stabilize it at a higher level, definitely we will take a call to increase price. Also, considering, you know, How is the movement on alternate fuel, petrol, diesel? We will certainly take a call and do the pass-through. But to be very specific to your answer, CNGS, since we have taken only one rupee increase, and prior to that, probably in February, we took some increase, it's certainly not fully passed on. Cost increase, considering... The mixing of pooled gas and current Brent level, other gas prices have gone up, so it is not fully passed on. But we consider that this is a short-term phenomenon. It should improve going forward.

Fair enough, sir. Next question, as per the 9th March government notification, CGTs will get the supply based upon the last 6 months average sales only. But now the question comes here. How are you managing the incremental growth in the CNG and the DPNG? Are we sourcing from the spot, or you just mentioned about the recently contracted LNG, which you are still not getting. So, are you right now managing the incremental CNG sales and the DPNG sales volume through the spot?

So, you know, Any term contract during this time can go under force measure, whether recently signed or signed earlier. So, that impact was there on us as well. Okay. So, definitely for CNG as well as domestic PNG, we might have to source some amount of spot.

Okay, sir. And lastly, sequentially, our other expenses have gone up. Is there any one-off item which has led to increase in other expenses?

You are referring year-on-year, then I can tell you. See, CNG volumes have gone up by almost 8%. So, directly variable expenses like power and fuel, LCV transportation, dispensing charges, etc. has gone up in line with the volume increase, okay. Other than that, there is an increase of around 30-35 crores in case of employee salaries, which mainly consists of, you know, there is a provision, actual provision on account of new wage code, which is in the range of around 14 crores. And maybe in the same employee category, there was a normal increment which consists of around 11 crore and some marginal increase on account of some software per activity. Other than that, miscellaneous OPEX is mainly repair maintenance and some of the rent for the CNG plot or store, etc., which we have hired, and some of them are already commissioned, some of them work is still going on, has gone up. Thank you. This is broadly the breakup or reason for increasing the operating costs.

Thanks a lot, and all the best.

Thank you. The next question is from the line of Vikash Jhin from CLSA. Please go ahead.

Yeah, thanks for taking my questions. I have a couple of them. Firstly, sir, if you could give the breakup of commercial and industrial volume for this particular quarter. So where did it stand in terms of ML? Thank you.

I think Mr. Vangley already said 0.57 was industry, and if my total was 0.719, balance is commercial. So this is for this quarter. But this is not a representative volume because despite demand we had to curtail. Even though we might have connected new customers, we have differed because overall category was asked to be curtailed at 80%. Okay, okay.

And I just want to understand, see, till March, honestly, there wasn't really so much of impact that you would have faced because by the time the government put in those restrictions, it was more towards the latter part of March. And pricing increases for many contracts. Like, new well gas only happened later, right? So, is it fair? And at the same point of time, how does the, after now that you're getting gas based on the allocations that everybody is at 80%, how does that work? I mean, are your old contracts still live? For example, the earlier contracts you had from Henry Hub, are you still getting So,

I think my broad understanding and probably that is the way supplies have worked is every contract has some supply or pay threshold or take or pay threshold, right? So, for the purpose of pooled gas, Over and above the supply or pay commitment has been pooled and given as a pooled price to all the CGTs. But balanced gas has definitely come to all of us. But there is a caveat, if there is a force major, even that can be reduced. But as far as Q4 is concerned, we have got up to supply or pay level, all the contracts we have received the gas. And as far as you are saying, the impact of this crisis, not only at the second of the March, it was for the full second half of the March. So second fortnight, we received pooled gas, and part of the first fortnight as well. So it started around 12th of March, almost. So I would say two-thirds of the month of March was impacted, and 10 days or 11 days was normal.

No, so, for example, CNG, I believe you said, correct me if I'm wrong, 0.7 MLS CMD is what you are using new well gas for.

No, no, no. I think Mr. Yogesh Patil from Dollop said the contract-wise and APM what I gave numbers. Total so around 4. So where did you source balance 0.7? So when he says balance 0.7, it is meant for all the categories, not only for...

Okay, so what is the new well gas number that you said? Sorry, I missed taking that number.

New well gas, I said in the second fortnight was in the range of 0.4, little more than 0.4.

Okay, so that's about 10%, a little 12% of your CNG requirement. So on that, for example, gas price has gone up by 70% or so, right? Like it's now $14 or so right now, for the month of May.

No, no, not really. Not really, not so much. It range maybe, you know, $11, $11.50. Maybe it spiked a little bit in April, and then again it is looking down probably now. Because, you see, Brent also went up and then came down, and Indian crude basket also went up and came down.

Okay, but the May price is based on April price, right? I mean, April price. Yes, okay.

Okay. So, in the price, the moment you change the weighted average source of gas, it may change. So, we are really not having any clue how does it get calculated.

Okay, okay, okay, okay, okay, I get that. So, sure. But in terms of your blended price of raw material, that has gone up considerably in April, May as compared to where it was in March, right? Is that correct?

Certainly, yes, because if pooled gas hovers between $11 to $13, and other indices are also up, because the earlier quarter, we were below even the ceiling. And because Brent was hovering $60, $65 kind of a thing. Now, if Brent is at $90 or $100, there is going to be impact on the gas cost. Also, exchange rate went up and slightly it has now come down. So that is saving a little bit. Okay.

And so, given all of this, what is your volume growth guidance for, say, FY27 and also? Your margin guidance, if any, and then, you know, okay, and as things normalize, do you maintain guidance beyond the war to be how it was historically? And could you repeat those numbers?

See, if you look at, you know, whatever blessings in disguise has happened due to this war, is circular or gazette notification dated 24th of March. Where a lot of, you know, functioning of CGD has been eased out. Also, there is a reduction in the road reinstatement charges. Permissions are becoming faster. If you apply for a road digging permission and it is not received within specified time, you can, you know, assume it is a deemed permission and start your work. RI charges have been slashed down and Central has specified very lower RI charges. So it will save on the cost. It will faster my network creation. So we are very positive that there will be certainly very good boost to the volumes, especially in PNG, industrial, I mean, domestic PNG, industrial and commercial customers. We will be able to connect the customers faster. Including even, you know, private societies where you have a neighboring society who was not giving earlier permission. According to that notification, even private property also, they have to give permission or give reasoning. So there are a lot of enablers which have come for CGD industry, and that will definitely, you know, put us on a fast track as far as laying pipeline and connecting the new customer is concerned. So, our guess is if I have clocked 8.25 overall volume growth this year, it should be certainly more than that. We should be able to, you know, cross. So, we are able to see, of course, there are constraints in terms of how do you get the required amount of labor, plumbers, contractors to execute that work, okay, because all the CGTs are eyeing for the same pool of resources as far as pipeline laying abilities or the labor available in the country. So, considering that, our view is, if we do faster connection, volumes will be maintained or it will be increasing. Now, coming to margins, I think it's a very difficult call as of today, because nobody knows how long this kind of a situation and supply of RLNG will improve. So, but our endeavor is if, you know, there is a room compared to the alternate fuels, we will be certainly trying to take, you know, required price increase to pass through the gas cost impact. So maybe our wish and endeavor could be we will maintain more than eight rupees EBITDA per SEM, but we'll have to consider multiple factors before we decide to do any price changes. However, one good factor is if Brent is remaining slightly higher. It is helping us in industrial commercial sector. Realization much better compared to earlier two quarters, I would say, where Brent was in the range of $65, $70. And now it is at least $90, $100. So giving a number is really difficult as of now.

More than 8 rupees in FY27 will possibly mean an exit. Closer to double digit, right? Because first quarter is more or less in front of us and that's going to be most likely lower than what the 4Q margins are. So more than 8 average for F527 will require a reasonably high margin exit for the year, right?

That's why I'm saying that it is very difficult to give a number, but our endeavor, and let's hope that, you know, things normalize, but I'm saying that in the long run, this is going to be a very good opportunity for MGL to create infrastructure and volume and margin both.

Our focus on increasing infrastructure and volumes will be at a slightly higher priority than, you know, maintaining margins. If we have to temporarily lose margins for gaining volumes, I think we are okay to do that, because the margins can be changed pretty quickly, but these kind of opportunities to grow infrastructure volume, they come pretty rarely.

Sure. Post-World Normalization Margin Guidance, sir.

Before I kind of let go.

See, another positive thing on margin is, earlier, you had a lot of volatility in Henry Hub, whereas we have 1.5 contracted quantity, we are getting half of that at least. And I hope that, you know, there is no force measure and we continue to get that, which has stabilized below $3. So there is already a respite in terms of pricing of Henry Hub, which is almost, you know. One-third of our contracted quantity, a little more than one-third of our contracted quantity. So, there are multiple factors which are against and some are positive also, I'm saying.

Thanks for answering my questions.

Thank you. The next question is from the line of Kaurav Jain from ICICI Prudential Mutual Fund. Please go ahead.

Sir, thank you for the opportunity. A couple of questions from my side. One is on the Henry Hub, the volume that we are getting. Is it HH linked and the earlier terms only, or is there some change in the pricing that we are getting it at? That is first. Second, sir, you mentioned somewhere that while you can add more commercial and industrial users, but you are not adding it currently because of the restriction of 80% of total gas in that sector or something. But we have the opportunity because there is demand. So how does that tie? These are the two questions, sir.

See, first, Henry Hub, it is formula-linked. There can be change in the quantity. The formula and the pricing remain same, linked to the index and whatever constant and the slope you have. So there is no change for whatever supplies you are getting. What I said in case of industrial commercial connection is, we will be connecting the customers faster, but because of the overall 80% curtailment of the volume, unless I get, you know, some market link volume and the customer is ready to take, volume may not increase. Okay.

On the commercial side, there is a good potential for increase because, you know, the situation of LPG is not very good. So a lot of demand is there for pipe gas, even at a premium. So we are getting a lot of registrations. I mean, previously the registrations would number in hundreds, now they're coming in thousands. And with the ease of infrastructure laying, pipeline permissions, etc., we will connect these customers. And overall commercial volumes are not that high. Plus the government is also telling us that, you know, give uninterrupted supply to critical commercial customers. So, small restaurants are falling in that critical customer category? So, they are continuing to get the requirement and that sector is growing very high. It is only some large industries who are facing some curtailment and back to, at present, I think the curtailment level has reduced significantly in the month of May. Hopefully, if that continues, we will be back to our normal INC volume growth.

And lastly, sir, on Spot LNG, if you can highlight that at what price, from what region, how easy is the availability, I mean, whatever color you can give on the Spot LNG availability for you and the country at large also, that will be helpful.

Spot LNG, we are sourcing through IGX, or wherever we have a framework agreement with multiple suppliers, we keep on checking. If somebody has a quantity, then we get it. So that's the two mechanisms through which we get Spot LNG. As far as pricing, I think it is available in the public domain. It is ranging between, you know, 11.5 to $13, sometimes $14. And that keeps on changing depending on the volumes available, depending on the time at which you are trying to approach the market.

We don't source cargos directly, usually through aggregators.

Got it, sir. Thank you and all the best.

Thank you. The next question is from the line of Amit Murakar from Access Capital. Please go ahead.

Hi, good evening, and thanks for the opportunity. So when you say that you expect more than 10% growth in FY27, I think you also said that industrial is down 20%. So are you expecting much higher growth from domestic TNG as well as CNG if you could break out the expected growth rate segment-wise also?

I think I would like to correct the understanding. What I said is, since, you know, infrastructure laying has been eased out, and there is a demand increasing for PNG due to LPG curtailment, definitely we have a, you know, opportunity to connect more and more customers. So, going forward, if we are able to work and lay the infrastructure and connect the customers. This year, we have done 8%. We can definitely, you know, if number of customers get added faster, we can achieve 10% volume. Okay, not necessarily, I'm saying, 26-27.

The delta will probably come from pipe gas. CNG may be, you know, at the usual normal rate of growth.

Sure. So, pipe gas and like, is it possible then that we add maybe a lot of customers and maybe we get like 20% or higher growth rate in pipe gas volume this year? That seems like a real possibility.

If you see industrial commercial last year, I'm saying 24-25, we grew by 24%. This year also, we have grown by 15%. And with this happening, if our ability to lay and connect is faster, because of a lot of easement on the road digging, formations, etc., we expect that we will be able to do better than in the past.

But again, there's one more caveat in it, because we are already into May now. The monsoon won't start soon. So once the monsoon starts, then it's not going to be possible to lay too much infrastructure on public roads. Inside housing societies, inside industrial premises, yes, that work will continue, but there would be some slowing in growth in June, July onwards, once the rains fit.

So, basically, because of LPG, dependence is very uncertain, there is a lot of demand for commercial LPG. Household, if you see the notification, wherever there is a gas connection available, if somebody is using LPG. So that will not be allowed beyond three months, and he has to mandatorily opt for PNG. So in our view, that will help us grow our domestic customers also high compared to what we have done in the past. So that will result in definitely volume growth.

Sure, sure. And I guess then CAPEX would also be higher this year if you are looking to lay so much of your pipeline infrastructure.

Some KPX may get reoriented. As Mr. Vaghile said earlier, we will be focusing on laying of pipeline infrastructure and connecting the customer. So we may, you know, and there is a reduction in the RI cost substantially. So that will get saved. So overall, there could be an increase, but not very substantial. Because RI has almost by more than half.

What is the guidance that you will give for KPEX then for 27?

Certainly it will be whatever we have been giving, 1,200 crore range. It can be little more than that if you are able to do. See, as I also said, there is a constraint on the labour supply, plumbers, etc. Because every CGT is now in the same situation, so there's a lot of poaching for the resources happening. There could be some impact of this crisis on the availability of material also. So unless labor and material both are available, depending on the availability of both these, we will be definitely connecting more people and laying infrastructure.

Only one uncertainty which used to be there in the past on CapEx, which is will we get permissions or no? That has gone away. That has gone away.

Got it, got it.

Thank you. The next question is from the line of Vineet Pankha from Nomura. Please go ahead.

Hi, sir. Thanks for the opportunity. Sir, the recently contracted volume that you talked about with you signed in Jan and Ethel, are these Brent linked?

Yes, Brent linked.

So, what is the logic of signing Brent linked contract when India is like $3, $4 for an institute cheaper, I think?

These were contracted sometimes before. Okay. And to balance our portfolio of industrial commercial supply with Henry Hub, you are more skewed towards Henry Hub. So, you know, in the shorter period, like a quarter or two quarter, things can move over here and there. But if you have balanced portfolio, it helps over a longer period of time.

Okay. And, sir, why was Angria volume cut to 50% in March? Is it going to the pooled gas?

Yes. Must be going to the pooled gas. We don't get any of this, but our supply is curtailed. Definitely, where will, you know, Gale will get the gas from all the term contracts, which they have, they will pull by, you know, curtailing the supply to every buyer to the extent of supply or pay, and they will put it to pool for. Coming to, I mean, supplying to CGD requirement, but we do not know.

We don't have direct visibility on that, so difficult to answer.

So, any idea when this cooling mechanism will be discontinued? Because NGV is the cheapest source of gas for you, and these have been cut at 50%.

I think all depends on how fast and when West Asia crisis are over, which nobody can run today, I think.

Okay, sir. And, sir, do you have any flexibility in terms of increasing HPHT gas? Because new oil gas is now much more expensive than even the HPHT. So, any way you can increase HPHT in place of new oil?

HPST gas has been coming through IGX in small quantities, and there are some old contracts which are expiring, and whenever they come up for rebidding, then CGD has a priority now. We will be hopeful that we will get some HPHT in the coming months. Definitely, there will be some availability of HPHT in this quarter or Q2.

Okay, sir. Lastly, how is the pricing of pooled gas divided?

Pricing of?

The pooled gas.

We are not private to that, so we don't know.

Okay, but the pooled gas is basically the imported gas, right? So, probably the weighted average of all the volumes that come to Gale.

I think it is anybody's guess. I will not be able to. It could be some vocal also. I don't know. Gale would be over. You should ask in the Gale phone.

Sure, sure, sure. Okay, sir, lastly, so... So incremental volume, how much upside, do you have a number on how much volume upside we can see on DPNG conversion because of LPG supply not being there, and also easier access to lay down pipelines? Maybe not for the near term, maybe for the longer term, what is the incremental volume upside from there?

Historically, DPNG has not grown very fast, about 6% or so. Definitely, this can go to double digits. Again, one thing we need to keep in mind that our penetration in the city of Mumbai, for example, in which our buildings we are in at, is pretty high, almost 90%. Residual potential is relatively less. In our expansion areas, if we go towards, you know, the municipalities which are in the suburbs and further away, their per capita consumption comes out to be lower. So, today if we have, you know, 2 million burning DPNG customers, we are trying to add at least 4 or 5 lakh additional to that in the shortest possible span of time. But, the incremental additions will not give you the sale per capita consumption, because this is going out in the extended suburbs. But, definitely, the volume contribution will expect to be more than 10%.

Apart from even extended suburbs in the existing area where, you know, it was gasified, say, 90%, and 10% people who stay 6 months in India and 6 months outside or somewhere else, outside Mumbai. Since they will be mandated to switch to PNG because of the government notification, their average consumption also will be low. So, I think the additional connections will not ensure the same per capita consumption.

Even if we do a 20% increase on customer base of DPNG burning customers, actively burning customers, that may translate into maybe 12% or so kind of increase in volumes in DPNG.

Sure, sir. Thank you. Thanks for the answer. Thank you.

Thank you. The next question is from the line of Indra Kumar Gupta from PL Capital. Please go ahead.

Thank you for the opportunity. I think the first question was answered. I just have a second question, which is more of housekeeping.

Can you please break down the CNG vehicles added in terms of, you know, buses, cars, autos for FI26?

So, year-on-year, we have added taxis, 26,000, private cars, 48,238, three-wheelers, 33,200, private buses, 223, mini buses, 188, we have MSRTC buses, 48, trucks, 318, tempos, 105. Small commercial vehicles, 7,400, and two wheelers, 2,465. So in total, around 1.18 lakhs of CNG vehicles have been added in this last financial year.

Okay, thank you. Thank you. The next question is from the line of Nitin Tiwari from Philip Capital. Please go ahead.

Hi, thank you for the opportunity. Good evening, sir. Sir, my question personally is a clarificatory one. If you could just for the sake of taking a clarity, reiterate what was our gas supply breakdown for the fourth quarter and also for the month of March? I suppose you gave it out for the month of March. And then I mean if we can put the contracted quantity in perspective as well. So, that would be the first one.

You want March again, you're saying, or?

No, if you can, if you can first, I mean, give out the contracted quantity that we have against that, how much did we get in the fourth quarter and in March? That's what I'm trying to understand.

Contracted quantity, how much we got in the... Just a minute. HH we got around, you know, in the Q4, 0.78. Okay.

Against the contract of 1.5, you said, right?

Correct, correct, yeah. Okay. You see, it was also done by us in some months, purposely because HH price was high. So we tried taking, so I'm saying this. Quantity will not matter, because depending on the relative price in the next month or next quarter, we will keep on changing. Because you saw, you know, in January, February, when Henry was at $7.50, we did not take even contracted quantity, and we took spot. So, but still, you are asking what a figure I am giving you.

Sure. And in the month of, in the, in the month of March, how much was this quantity, the term HH quantity?

In the month of March, I think. You're saying HH in the month of March? Yes. HH I'll tell you for the second fortnight was little more than half a million.

Okay.

First fortnight it was almost 0.75 or 0.78. So average could be 0.65 or 0.7.

Okay, second fortnight was 0.5 and first fortnight was 0.7, right?

Yeah, yeah. We can do a bit.

Sure, sir. And if we can have the same figures for your HPHT contracted quantity as well as other term LNG contracts?

I don't have HPHT, whatever we get, you know, contracted or through IGX, I have the combined number. As I said earlier, in the month of March, we have taken almost 0.9 HPHT.

Okay. And in the fourth quarter?

Fourth quarter combined HPHT, 0.7 average.

Okay, and same figures for APM and NWG for the fourth quarter and for the month of March again?

No, no, APM for the full quarter on an average was more than 1.73. Okay. For March, first... Fortnight could be in the range of 1.7, but second fortnight was somewhere around 1.56 or something.

Okay, and NWG, sir?

NWG, both, you can take a little more than 0.4 quarter as well as...

For the quarter?

Both, March also. Little more than 0.4. There's not much difference with her because balance came through pulled gas.

Sorry, sir, you had initially mentioned that NWG pool was around 0.73 to 0.75 for the month of March, right?

I said NWG plus pool, I had said, okay?

Okay, okay. So NWG was 0.4?

A little more than 0.4, yes.

Okay, and remaining was pool, right?

Yeah, yeah. But as I said earlier also, these quantities keep on changing. There is no guarantee.

No, I understand, sir. But, I mean, what I'm trying to understand is that in the fourth quarter, basically pool pricing came in only in March, right? So, I mean, when we are looking at the quantity for the entire quarter, the effect of pool would be only in the month of March. So, what was the NWG quantity for the entire quarter? It was still 0.4 only?

Pooled was there for some part of first fortnight also, so not only the second fortnight, March, yes, you are saying, roughly two-third of the March was having pooled, pooled, yes.

All right.

Thank you. The next question is from the line of Tanai Kotecha from Nuwama. Please go ahead.

Hi, sir. Thanks for the opportunity. So, it seems that there's a 1% year on your fall in your P&G domestic volumes. Is there any specific reason for the same?

There's no fall in domestic P&G volumes. Are you talking about per capita consumption or you're talking about absolute volume fall?

Absolute volume, sir. Q4 to Q4.

Domestic volume year-on-year has grown by 7% or something? 6.6%. There is an increase in domestic volume. There is no fall in the domestic volume.

Okay.

All right.

No problem.

DPNG and Fund 04 and INC. Okay.

No problem.

Thank you. The next question is from the line of Yash Mananda from Kuwait Test Investment. Please go ahead.

Hi, sir. Am I audible?

Yes, sir, you are.

Thanks a lot for the opportunity. Most of my questions are answered. Just one, if we look at a longer term version, we were sort of talking about the LNG prices sort of going downwards in, say, two, three years because of the increased capacity coming in in the U.S. What do you think would be the price in the long term at which it would become attractive for most of the Indian people to sort of switch? So last time you were mentioning somewhere around $9 to $10 would be the price at which price-instrictive customers would convert. What would be the price right now for you?

It totally depends on what the alternate energy sources or alternate fuel prices are. You know, 10-15 years back, I mean, $5 looked very high. Today, $5 is normal. Okay.

So, basically, it will be a function of, say, petrol diesel versus LNG, right?

LPG and industrial fuels.

Okay, LPG and industrial fuels as well. Okay. Understood, sir. Yeah. Thanks a lot, sir. Thanks a lot for that piece.

Thank you. The next question is from the line of Shreyas D1, an individual investor. Please go ahead.

Thanks for taking my question. I just wanted to understand that when the brand goes from, let's say, 60 to 95, right, there is, of course, an input cost pressure that we get because of our sourcing mix, and there is an output price benefit that we get from our INC because it's linked to the brand crude. But as a net impact, generally, is this beneficial for our company, like when it goes from 60 to 95, or it hurts us? That's what I wanted to understand.

See, as you rightly said, the realization will go up, okay? When you say Hertz is, because if my input gas cost is linked to Brent, more proportion, then it may remain similar, but we have a mix, and the mix is skewed towards HH, which has remained low while Brent is higher. So under this scenario, it should benefit us in terms of net margin.

Especially in the RNC segment, the... On absolute terms, the increase in gas cost is lower than the realisation, so that way higher oil prices help us in INC. Correct.

In IMC, they do help us, but in the other segments where we still, there is an input cause that gets, you know, impacted because of our, like, the sources which are linked to the brand. That is also going to have a negative impact at an overall level. So, at an overall level, I just wanted to understand.

No, no. See, as far as domestic PNG is concerned, it is fully through APM, which has a scale in. Even CNG, one-third of the quantity is through APM, which has a ceiling. If I have 0.9, roughly, HPHT, which is also ceiling-driven, so it doesn't impact directly.

But directionally, if you look, if there is a sustained high level of brand, then, you know, after some time, the oil diesel prices do go up. Yes, the government will stabilize for some time, but that cannot happen indefinitely.

So, if Brent is up and petrol diesel prices are kept artificially at a lower level, then I will certainly get impacted, but otherwise it is not there. So, Brent going up generally will help.

Generally, it is good for margins.

Thank you. The next question is from the line of Amit Muratka from Access Capital. Please go ahead.

Yeah, hi. Thanks for the opportunity. So, I just wanted to understand, like, the CNG vehicle addition seemed to have slowed down a bit, as we can see from the Vahan data. So, what are the reasons for this slowdown?

Which period you are referring to, Amit? So, if you see last two quarters, we have added almost 67,000 vehicles, okay, which is quite a high number compared to earlier two quarters, which was roughly 50,000. So, in fact, there is an increase. There is no decrease.

Oh, okay. Maybe, maybe, I'll just reconnect with you. I saw the details. Maybe I'll check if I can reconnect with you. In our presentation as well, you can see them. Sure, sure. Yeah, sure. And on the margin, if I can just reconfirm, you mentioned that the near-term margin is a bit lower than what it was in Q4, right? I mean, what you are seeing right now in April and March, in April and May, you said that the cost price increase is not fully covered for the cost increases. That understanding is correct, right?

Yeah, yeah, specifically in case of CNG, complete pass-through could not be done. Hello.

Thank you. Due to time concentration, we will take this as the last question. I now hand the conference over to Mr. Gagan, sir. Thank you and over to you.

Yeah, before we end the call, I would like to mention that some of the statements made in today's discussion will be forward-looking in the future, and we believe that expectations contained in the statement as to easily. However, these statements involve number of risk and uncertainty that will lead to different results. We are due 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 the management for closing remarks. Over to yourself.

Thank you, everybody, for joining us on this call.

Thank you.

Thank you so much. Thank you.

Thank you.

On behalf of LARA Securities, that concludes this conference. Thank you for joining us. You may now disconnect your lines.