IGL Q1 net profit falls 48% to Rs 186 crore as higher gas cost squeezes margins
New Delhi, August 13
Indraprastha Gas Limited reported a sharp decline in profits in the first quarter of the current financial year, with standalone net profit falling 48 per cent year-on-year as higher input gas costs squeezed margins, even as the city gas distributor recorded its highest-ever quarterly revenue.
IGL's standalone net profit fell to Rs 186.18 crore in the quarter ended June 2026 from Rs 355.94 crore in the corresponding quarter last year, according to the company's unaudited financial results.
Revenue from operations, however, rose about 16 per cent to a record Rs 5,040.15 crore from Rs 4,326.60 crore in the year-ago period.
The company attributed the pressure on profitability to elevated gas costs following volatility in global LNG prices.
"Volatility in LNG prices due to West Asia crisis led to increased input gas cost for IGL resulting in margins being supressed for the quarter," IGL said in its earnings release.
The impact of higher input costs was also reflected in the company's operating performance. EBITDA fell 42 per cent to Rs 295.50 crore from Rs 511.75 crore a year ago, while EBITDA margin declined to 6 per cent from 13 per cent.
IGL's purchase cost of natural gas rose to Rs 3,810.86 crore during the quarter from Rs 2,927.93 crore in the corresponding period last year.
Despite the pressure on margins, the company's gas sales volumes continued to grow. Total sales volumes increased 6 per cent year-on-year to 878.98 million standard cubic metres, while average daily sales rose to a record 9.66 million standard cubic metres per day (mmscmd) from 9.13 mmscmd.
CNG volumes, which account for the bulk of IGL's gas sales, grew 6 per cent during the quarter, while total PNG volumes increased about 4 per cent.
Shares of Indraprastha Gas Limited ended 1.79 per cent lower at Rs 151.77 apiece on Thursday following the announcement of its June-quarter results.
— ANI
Reader Comments
Honestly, I'm not surprised. With all the geopolitical tensions and LNG prices flaring up, every gas company is feeling the heat. But the silver lining here is that volumes are still growing! 9.66 mmscmd is a record. This shows the demand for clean energy in Delhi-NCR is only increasing. Good times ahead once global prices cool down. 📈
IGL's revenue is at an all-time high, but profits are halved. This is a classic case of a squeeze! CNG is still a much better option compared to petrol and diesel, even with these cost pressures. I just hope the government steps in to subsidize or ensure that the retail prices don't skyrocket, especially for auto-rickshaw drivers and bus operators who depend on CNG.
From a global perspective, this is a reminder that energy security is still a massive issue. India is heavily reliant on imported LNG, and the West Asia crisis is a stark warning about the fragility of the supply chain. IGL's management has done well to keep volumes growing, but they need to diversify their sourcing. Maybe invest in more domestic gas exploration or look at long-term deals with Qatar and the US.
This is the cost of progress. The transition to cleaner fuels comes with its own volatility. But as an investor, I'm a bit disappointed. The share price dropped too. However, I believe this is just a cyclical downturn. IGL has a near-monopoly in the NCR region, and the growth in volumes is promising. I'm holding on to my shares for the long term. 💪
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