This article first appeared on GuruFocus .
Release Date: February 13, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Indraprastha Gas Ltd ( BOM:532514 ) maintained its volume guidance, expecting to exit the year at around 10 million cubic meters per day.
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The company anticipates a significant boost in EBITDA margins from the current INR5.4 per unit to a target range of INR7 to INR8.
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There is a planned increase in CNG stations, with a target of adding 80 to 100 stations annually over the next few years.
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The company is confident in achieving a 10% growth rate in the NCR region and 17-18% growth outside the NCR.
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Indraprastha Gas Ltd ( BOM:532514 ) is exploring opportunities in the Middle East, having qualified for the second stage of a tender process, indicating potential for international expansion.
Negative Points
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The company faced headwinds from higher gas costs and foreign exchange fluctuations, impacting overall profitability.
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DTC volumes have significantly decreased, contributing to a decline in overall sales volume.
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The implementation of new labor codes resulted in a one-time provision, affecting margins.
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There is a dependency on RLNG, with 50% of gas sourcing expected to come from this source, which could be subject to price volatility.
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The company faces challenges in expanding its infrastructure to meet growing demand, particularly in the NCR region, where queuing remains a concern.
Q & A Highlights
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Q: Can you provide guidance on the EBITDA margin improvement from the current level of INR 5.4 per SCM to the target of INR 7? A: CFO: The improvement will be driven by factors such as the transmission tariff impact, which should translate to approximately 75 paise per SCM. Additionally, the labor code implementation was a one-time provision, and going forward, it may not be as high. We expect these factors to bring us closer to our target range of INR 7 to 8 per SCM.
Q: What is the volume guidance for this year and the next, and can you provide a sales breakup across regions? A: CEO: We maintain our guidance of exiting this year at about 10 MMSCMD. For the current year, Delhi contributes around 56%, Noida and Ghaziabad contribute 23%, and newer areas contribute about 14%. Growth rates in these areas are expected to be around 6.2% for Noida and Ghaziabad, and 17% for newer areas.
Q: How do you plan to manage sourcing strategy given the recent trends in energy hubs? A: COO: We anticipate a 50/50 split between RLNG and domestic sources, including HPHT and APM. Our strategy is to diversify and maintain a balance between Brent-linked and Henry Hub-linked contracts to optimize costs.
Q: Can you elaborate on the CapEx plans for the next few years, particularly for CNG stations and pipeline infrastructure? A: CFO: We plan to add 80 to 100 CNG stations annually over the next few years. Approximately 40-45% of our CapEx will be allocated to CNG infrastructure, with the remainder going towards steel pipeline networks and MDP. We aim to add 1 MMSCMD in volume annually, with 70% from CNG and 30% from PNG.
Q: What impact did the reduction in sales tax and higher gas costs have on your financials this quarter? A: CFO: The exchange rate fluctuation led to a 7-8% increase in gas costs, partially offset by the sales tax reduction. The net impact was a 35 to 40 paise per SCM benefit, realized only in December, but expected to continue for the full quarter going forward.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
