Adani Total Gas revenue jumps 34% as costlier gas holds back profit growth

what happened

Adani Total Gas (ATGL) reported a 34% year-on-year increase in revenue from operations, reaching Rs 2,102 crore in the second quarter of fiscal 2026-27. Stronger sales of compressed natural gas for vehicles and piped gas for households drove the top line, Moody's said.

Net profit rose only 3% to Rs 167 crore. Gas purchase costs linked to Brent, a smaller share of domestic gas sold under the administered pricing system and a weaker rupee squeezed margins. EBITDA climbed 12% to Rs 340 crore, while pre-tax profit grew 8% to Rs 235 crore. Cost of goods sold surged 43%.

Combined CNG and PNG volumes grew 12% to 315 million standard cubic metres. The company added 16 fuel stations, bringing its network to 723, and domestic PNG connections reached 1.181 million. Including the joint venture IOAGPL, gas volumes totalled 529 million cubic metres, up 18%. In the first half, ATGL's net profit fell 7%.

why it matters

For investors, the takeaway is that sales growth is not translating into profit when gas costs rise faster than the company can pass them on to customers. ATGL's earnings are sensitive to Brent-linked prices and the rupee, so procurement costs remain a key factor for shares in India's city gas distribution sector.

market impact

ATGL and India's gas distribution sector: costlier gas pressures margins even as sales grow.

tags

instruments