Mahanagar Gas Q2 sees volume growth despite profit drop

Mahanagar Gas Limited (MGL) reported an overall average gas sales volume of 4.593 MMSCMD for Q2 FY26, a 3.11% increase from the previous quarter and a 9.22% increase compared to Q2 FY25. For the first half of FY26, average sales volume rose by 9.91% to 4.524 MMSCMD. This growth was driven by increases across all segments, with CNG volume rising to 3.255 MMSCMD, domestic PNG to 0.582 MMSCMD, and industrial and commercial sales reaching 0.757 MMSCMD in Q2.

Despite the volume growth, MGL's EBITDA for Q2 FY26 stood at INR338 crores, down from INR501 crores in the previous quarter, with net profit after tax at INR193 crores, compared to INR320 crores. The company attributed the margin reduction primarily to increased gas costs due to a changing gas mix and higher exchange rates, partially offset by some price adjustments. MGL aims to maintain margins in the INR8.5 to INR9.5 range, with a focus on volume growth, targeting around 80 new CNG stations for the full year.

The company is integrating Unison Enviro Private Limited post-amalgamation, with all previous financial statements restated to reflect the combined entity. MGL anticipates tax benefits from the amalgamation, estimated at INR35 crores for FY24 and FY25, due to the depreciation of license costs. Capital expenditure guidance for FY26 is projected between INR1,100 crores and INR1,200 crores, including the UEPL 3GA's.