Earnings call transcript: GAIL Ltd Q1 2025 sees robust growth and stock uptick

GAIL Ltd reported strong financial results for the first quarter of 2025, with significant increases in profit and revenue. The company’s stock reacted positively, rising by 1.17% to 186.98, reflecting investor confidence in its performance and future prospects. With a market capitalization of $14.28 billion, GAIL maintains a strong financial position, earning a "GOOD" overall health score of 2.95 on InvestingPro. The platform’s analysis reveals GAIL as a prominent player in the Gas Utilities industry, operating with moderate debt levels and maintaining strong cash flows.

Key Takeaways

• GAIL Ltd’s standalone profit after tax increased by 28% year-over-year.
• The company announced a final dividend of ₹1 per equity share, with a payout ratio of 43.59%.
• GAIL Ltd is expanding its petrochemical and city gas distribution operations, with several projects underway.

Company Performance

GAIL Ltd demonstrated strong growth in the first quarter of 2025, with standalone profit after tax surging by 28% to ₹11,312 crores. The company’s consolidated turnover rose by 7% to ₹1,41,009.49 crores. This performance is attributed to increased natural gas transmission and marketing volumes, as well as strategic investments in infrastructure and petrochemical projects.

Financial Highlights

• Standalone Gross Turnover: ₹1,36,009.60 crores, up 5%
• Standalone Profit Before Tax: ₹14,825 crores, up 28%
• Standalone Profit After Tax: ₹11,312 crores, up 28%
• Consolidated Profit After Tax: ₹12,450 crores, up 26%
• Final Dividend: ₹1 per equity share

Market Reaction

Following the earnings announcement, GAIL Ltd’s stock price increased by 1.17%, closing at 186.98. This positive movement reflects investor approval of the company’s strong financial performance and strategic direction. Trading at a P/E ratio of 9.84, the stock appears attractively valued relative to its near-term earnings growth potential. Analyst consensus from InvestingPro shows a bullish outlook, with price targets ranging from $1.81 to $3.16, suggesting potential upside opportunity.

Outlook & Guidance

Looking forward, GAIL Ltd plans to enhance its natural gas transmission volumes and expand its city gas distribution networks. The company is also commissioning several petrochemical projects in FY 2025-26, including a 60 KTA Polypropylene plant at Pata and a 1.25 MTPA PTA project at Mangalore. These initiatives are expected to bolster future earnings and market position.

Executive Commentary

"Transmission remains our biggest bet," said Sandeep Kumar Gupta, Chairman and Managing Director, highlighting the company’s focus on expanding its transmission capabilities. Sanjay Kumar, Director of Marketing, emphasized the potential of the city gas distribution segment, stating, "We believe the market is so big that the EV push would not affect the growth of CGD segment."

Risks and Challenges

• Regulatory changes could impact natural gas pricing and distribution.
• Increased competition in the petrochemical sector may pressure margins.
• Supply chain disruptions could affect project timelines and costs.

Q&A

During the earnings call, analysts inquired about GAIL Ltd’s LNG contract strategies and the expected impact of new petrochemical projects. Executives reassured stakeholders of the company’s balanced contract portfolio and growth potential in the city gas distribution sector.

GAIL Ltd’s strategic focus on expanding its infrastructure and product offerings positions it well for future growth, with positive investor sentiment reflected in its recent stock performance. For comprehensive analysis and detailed insights, including exclusive ProTips and Fair Value assessments, investors can access the full company research report available on InvestingPro, part of their coverage of 1,400+ top stocks.

Full transcript - GAIL Ltd (GAIL) Q4 2025:

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Okay. Morning, everyone. Thank you for joining Gale’s Annual Investor and Analyst Meet two thousand twenty five being organized via our web conference. My name is Abhishek, and I cover the oil and gas sector at Montreal Oswal Financial Services.

Before we begin this call, a request to all the participants to please keep your video on while you are asking a question. Also, request if you can please rename yourself so as to display organization name during the call. This analyst meet was earlier to be held as a physical meet in Mumbai, due to unavoidable reasons, had to be converted into a virtual conference. And we are joined today by senior management from Gale. We have with us Sri Sandeep Kumar Gupta, who is the chairman and managing director for Gale India Limited.

Sri Gupta is a fellow of the Institute of Chartered Accountants of India and also a distinguished fellow of the Institute of Directors. He has wide experience of over thirty six years in the oil and gas industry. Before joining Gale in October 2022, Shri Gupta held the position of director finance since August 2019 on the board of IOCL. As director finance, he was in charge of f and a treasury pricing, international trade, corporate affairs, and enterprise risk management. Sri Gupta is also chairman of various other companies such as Mohanagar Gas, Brahmaputra Cracker and Polyman Limited, and Gale Gas Limited, and director on the board of Petronate LNG Limited.

We are also joined by Sri Arkajan, who is director finance. He’s a cost and management accountant by provision and joined Gale in 1992. Prior to his appointment as director finance, Srijan held the position of executive director finance and accounts in Gale. Additionally, Srijan holds the position of director in Hindustra Gas Limited. Gale Gas, Gale Global USA, and Glale Global USA LNG LNG.

As ED finance and accounts, he headed corporate finance and treasury and took investment decisions in large infrastructure projects. He was also actively involved in investor relations and interactions with analyst fraternity. Besides serving a long tenure at Gale, he was on deputation to PNGRV as joint director commercial finance. And lastly, we are joined by Ashish Sanjay Kumar, director of marketing. He’s a graduate in mechanical engineering from IIT Kharagpur and also holds a master of business administration degree.

He joined Gale in 1988 and has worked across domains, including gas marketing, CGD, LNG sourcing, trading, shipping, and business development. This cross functional and multi experience has enabled him to gain deep insight on all aspects of the gas and LNG value chain. Shri Kumar has played an important role in developing Gil’s overseas LNG trading business. He was managing director of Intercostia Gas Limited, the largest CNG distribution company in India before he was in charge of director marketing deal. And now without further delay, I will hand over to the management for opening comments.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Thank you very much, Abhishek. Good morning to all my friends from research and analyst community. At the outset, my apologies for not being present physically, but you can appreciate what were the situations. Because of that, we had to call off this meeting and hold it on virtual mode. I welcome you all to the analyst meet of Gale India Limited for financial year 2425.

We truly appreciate your taking the time to be with us. Throughout f y twenty five, we showcased the resilience and growth driven by our diverse portfolio. Despite challenges in global economy, our company had a landmark year reaching unprecedented financial milestones and achieving the highest ever EBITDA, PBT, and profit after tax in Gale’s history. Further, improved operational performance was witnessed across all segments, barring the LHC segment owing to the allocation of EPM gas. Before going to the financials for for FY ’25, I would like to focus your attention to certain key business highlights.

First, successful completion of the long awaited breakwater project has been achieved at KLL Doublehole. This marks a significant milestone in KLL’s journey towards becoming an all weather port, which has increased Gale’s flexibility to efficiently respond to market dynamics. We are awaiting the final confirmation, final permission, which should be available in about a week’s time, after which this will operate during monsoon period also. Gale has incorporated its wholly owned subsidiary, Gale Global IFSC Limited at Gift City in Gandhinagar, Gujarat, which will focus on undertaking global and regional corporate treasury center activities to further expand our business portfolio and enhance financial capabilities. Furthermore, we intend to capitalize on strategic advantages in the future by expanding into ship leasing operations through this entity.

As you are aware, Gale, along with its joint venture companies and subsidiaries, is authorized to develop city gas distribution networks in 72 geographical areas across the country. Among these, Gale directly operates in six, CGDs, six as geographical areas, namely Varanasi, Patna, Raji, Jamshedpur, Bhubaneswar, and Qatar, which are currently in their early stages of development. In the financial year 2425, these six GAs have shown impressive growth with volumes increasing by approximately 25%. We are constantly reviewing these CGDs to optimize costs and and enhance efficiencies. In order to have a single entity for development of Gale’s CGD business and for bringing business synergy, efficiency, and retail focused business approach, the board has recommended to transfer six geographical areas of Gale to its wholly owned subsidiary, Gale Gas Limited.

This was approved in the board meeting yesterday. This is subject to approval of CCEA since these six GAs were authorized to Gale by CCEA. PNGRB has recently proposed important reforms to the natural gas pipeline tariff structure focusing on simplifying the tariff zones, capping tariff for CNG and domestic PNG consumers at the level of zone one tariff and facilitating commercial viability of isolated networks through tariff rationalization. These initiatives aim to boost investment, enhance infrastructure, and make natural gas more accessible across India. Further, PNGRB has started the tariff review process of our integrated pipeline network and had hosted a PCD in this regard.

We expect the revised tariff to be announced by end of current quarter. This will have a considerable positive impact on Gale’s transmission segment revenues as was also detailed, during my interviews in the March. Now proceeding with financials, the results for quarter and year ended thirty first March twenty five have been declared yesterday on thirteenth May twenty twenty five. For f y twenty five, on a stand alone basis, Gale achieved gross turnover of rupees 1 lakh $36,009.60 crores. PBT stood at rupees 14,825 crores, an increase of 28 over previous year.

And PAT stood at rupees 11,312 crores, an increase of 28% for previous year. The strong performance of f y twenty five is fueled by enhanced operational performance with natural gas transmission seeing a 6% increase, natural gas marketing growing by 3%, petrochemicals achieving a 6% growth in production despite LHC production declining by 5% due to the reduction in APM gas allocation in quarter four. On a consolidated basis, Gale clocked a turnover of rupees 1 lakh $41,009.49 crore in f y twenty twenty five versus rupees 1 lakh $33,001.30 crore in previous year, up by 7%. PBT is in FY ’25 stood at Rs 16,096 crore and PAT stood at Rs 12,450 crore, up by twenty six percent. The Board of Directors has recommended a final dividend of Rs 1 per equity share for the financial year 2425, subject to shareholder approval at the upcoming annual general meeting.

This is an addition to the interim dividend of rupees $6.06 rupees 50 paisa per share declared, previously. Consequently, the dividend payout ratio for the financial year 2425 stands at 43.59%. Now I would like to share the performance highlights of f y twenty five. First is stand alone. Gale clocked the turnover of rupees 1 lakh $36,009.60 crore in f y twenty five as against rupees 1 lakh $30,002.84 crores in f y twenty four, an increase of 5%, mainly on account of increase in gas marketing volume, increased transmission, and petchem volumes and better price realization in liquid hydrocarbons segment.

The PBT increased by 28% to $14.08 25 crores as against rupees $11,505.55 crores and PAT by 28% to 11,312 crores as against rupees 8,836 crores in the previous year. There was an exceptional income of rupees $2.04 $4.00 crores on account of arbitration settlement with mess SMTS, which was accounted in quarter three of the current year. On quarterly basis, q four versus q three of this year, the gross turnover stood at rupees 35,607 crore in the current quarter as against rupees 34,912 crore in q three f y twenty five. The increase of 2% may mainly is due to increase in sales of natural gas and petrochemicals. The PBT and PAD during the quarter stood at rupees 2,701 crore and rupees 2,049 crore as against rupees $5.00 $2.09 crores and rupees $3.08 $6.07 crores in q three f y twenty five.

The decrease, as you are aware, is mainly due

Unnamed Speaker, Finance Team, Gale India Limited: to an exceptional income of rupees $2.04 $4.00 crore accounted in q three f y twenty five towards arbitration settlement with Messrs Seifi Marketing Singapore. Moving to consolidated financials. On yearly basis, the consolidated turnover stood at rupees 1 lakh $41,009.49 crore versus rupees 1 lakh $33,001.30 crore in

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: the previous year in the previous quarter, which is an increase of 7%. The PBT in f y twenty five oh, sorry. This 1 lakh $33,001.30 crore was in the previous year, and the increase is 7%. The PBT in f y twenty five is stood at rupees 16,096 crore versus rupees $12.05 95 crore in f y twenty four, which is an increase of 28%. And the PAT is stood at rupees 12,450 crores in f y twenty five versus 9,899 crore in FY twenty four, which is an increase of 26%.

On a quarterly basis, q four versus q three of this year, the consolidated turnover in the current quarter stood at rupees $36.04 48 crore versus rupees 36,887 crore in the previous quarter. The PBT in the current quarter is rupees 3,240 crore versus rupees 5,272 crore in quarter three of f y twenty three, and the PAT is rupees 2,492 crore versus rupees 8,082 crore in q three of f y twenty three. I would now like to share segment wise physical performance and the outlook for this short to medium term. Gas marketing volume is stood at at one zero one point four nine MMS CMD in f y twenty five, an increase of 3% as against 98.45 MMS CMD in previous year. The increase is mainly due to increase in demand in domestic market and overseas sales.

During FY twenty four twenty five, our gas marketing segment has exhibited robust performance by clocking a PBT of approximately rupees $7.02 $7.03 crores, including the exceptional income of rupees $2.04 $4.00 crores. The gas marketing segment PBT for FY ’25 has exceeded our guidance of rupees 4,500 crores. India’s natural gas market is set for a strong growth fueled by significant infrastructure development, regulatory support, and increased global supply. As per recent report by PNGRB on India in on India’s natural gas projection for 02/00/1930, the natural gas consumption in the country is expected to reach two ninety seven MMS CMD by 02/00/1930, assuming moderate growth. Being the dominant player in the natural gas sector, Gale is expected to capitalize on the growing demand.

And to cater this demand, Gale intends to source another five to six mmTPA of LNG from different geographies by 02/00/1930. We are confident that in the current financial year, our gas marketing segment will generate a minimum of rupees 4,500 crore in profit before tax. Additionally, we are actively pursuing short to medium term tie up with customers, which will further enhance our profitability. Moreover, we will implement our all possible measures to optimize and improve efficiency within our gas marketing portfolio. Now 4,000 crore, when I’m saying, I maintain the band of 4,000 crore to 4,500 crore, which band we had given to you in the earlier meetings.

Coming to natural gas transmission, volume for FY twenty five is stood at one twenty seven point three two MMS CMD as against one twenty point four six MMS CMD in previous financial year. The capacity utilization was approximately 16 61% in our natural gas pipelines. The increase in transmission volume is attributed to increased domestic consumption. We expect that that gas transmission volume will be approximately one thirty eight to one thirty nine s c m d during f y twenty five twenty six. As already informed, the tariff review for Gales integrated network is in progress, which is expected to be implemented in FY twenty five twenty six.

And this is expected to have significant positive impact on Gales transmission revenue. Coming to polymers, overall production of eight twenty seven TMT was achieved in FY ’20 ’4 ’20 ’5, which is 2% of the capacity utilization. In petrochemicals, we closed FY twenty four twenty five almost at breakeven levels despite increased input costs and distress on petrochem prices. During FY 2526, Gale will continue to take various optimization measures to optimize and improve efficiency in petrochemicals run the petrochemical plant at full capacity. It is expected that Gale will make reasonable profits in PC segment during FY 2526, provided the prices are favorable, both of, the input as well as output.

Coming to LHC, it the production was down by 5% as compared to previous year and is stood at nine forty seven TMT as against nine ninety six TMT in the previous year. The capacity utilization was approximately 66. The decrease is attributed to the allocation of APM gas for LPG production with effect from sixteenth January twenty twenty five. In addition to various optimization measures taken to protect the margins, the matter was taken up with MOPNG for restoration of allocation of APM gas. And the wide order dated eighteenth April twenty twenty five, MOPNG has allocated new well gas of approximately point three two s CMD to gale for LPG production.

This has restored the reduction in APM allocation by approximately 50%. We expect good margins and improved production from this segment in f y twenty six. LPG transmission volume increased to two four four seven eight TMT as against four three nine six TMT in previous quarter, and, this was highest ever LPG transmission by Gale. CGD. According to a recent report published by PNGRP, the CGD sector is anticipated to be the key driver of growth with consumption expected to increase 2.5 to 3.5 times by two zero three zero and six to seven times by two zero four zero from the baseline of approximately 37 MMScMD in FY twenty four, reflecting a CAGR of around 1512% respectively.

Further, Gale Gas Limited, a wholly owned subsidiary of Gale, which was incorporated in May 2008 for developing City Gas distribution business as its focus area. GGL currently owns and operates 16 GAs across India and have nine others as in their as their JVs. During the current fifth financial year, that is f y twenty five, Gale Gas Limited’s turnover stood at rupees 12,231 crore as against rupees $10,009.44 crore in f y twenty four. PPT increased by 42 and stood at rupees $6.01 5 crore as against rupees $4.03 4 crore in f y twenty four. And PAT was up by 40% and stood at rupees $4.51 crores as against rupees $3.23 crore in f y twenty four.

During the current quarter, that is q four f y twenty five, Gale Gas Limited’s turnover stood at rupees $3.00 $5.01 crore as against rupees $3.00 $4.03 crore in q three f y twenty five. PBTing decreased by 7% and stood at rupees $1.44 crore as against rupees $1.55 crore in q three, and PAT was down by 8% and stood at rupees $1.00 2 crore as against rupees $1.01 4 crore in q two q two f y twenty five q t q three f y twenty five. In the next two years, Gale gas targets Gale gas targets to add around two fifty five new CNG stations and approximately 3.09 lakhs new DPG connections. As regards Bengal Gas Company Limited, I just wanted to inform you that this pipe pipeline has been completed and gasified by Gale till Tapoff Point for Calcutta Kolkata connectivity. Gale has got the peso approval on twenty sixth November twenty fourth for this stretch, Durga Pu to IP 8 and CGS, Kolkata.

Further, Peso approval from Gale Terminal at IP 8 to Bengal Gas g CGS is received on twenty eighth February twenty twenty five, and it will take about one to two months for BGCL to complete the construction work on its part before it starts taking gas for Kolkata. The status of some of the ongoing projects. First, pipeline projects. I’m glad to inform that majority of the pipeline projects, namely Mumbai, Nagpur, Jharsuruda, Jabalpur pipeline, Jagdishpur, Haldia, Bocarodhamra pipeline, Kochi, Kotunad, Bangalore Bangalore pipeline, and Sri Gakula, Mangal pipeline are scheduled to be completed in current financial year, that is 2526, Gurdaaspur, Jammu pipeline is scheduled for completion in f y twenty six, twenty seven. Dhamra Haldi and Durga Purr Haldi pipeline section of JHB TPL are pending for commissioning and expected to be commissioned by thirty first December twenty five.

In petrochemical projects, again, I am glad to inform that all the three running petrochemical projects that is 60 kt a polypropylene plant project at Pata, Five Hundred Kt a PDH polypropylene at Usaat, and 1.25 MTPA PTA project at GMPL, Mangalore are scheduled to commission in the current financial year. In fact, PATAPIP should happen very soon. Coming to CapEx for FY ’25, during the year, a CapEx of rupees 10,512 crores was incurred out of which, rupees 2,200 crore approximately is on pipelines. Approximately, rupees 2,700 crores is on petrochemicals. Approximately rupees 3,000 crores is on leasehold assets.

Operational CapEx is of around 1,600 crores, and the balance is towards net zero renewables, CGD, E and P, equity contribution, etcetera. That’s all from my side regarding the overview of the performance and projects. The management of the company is available, and we would be glad to clarify you on any questions that you may have. Over to you, Abhishek. Thank you very much.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Great. Thank you so much, sir, for the opening comments. Very insightful. We will now start the q and a session. Participants may please raise their hand and state their name and firm name before asking a question.

Again, a reminder to have your video in the one mode, please. And please restrict yourself to two questions at a time. Okay? So we have the first question coming in from Puneet Gulati. Puneet, if you can unmute and ask your question, please.

Unnamed Speaker, Finance Team, Gale India Limited: Yeah. Thank you so much. Yeah. Congratulations on good numbers. My first question is on your gas marketing business.

The first part is when I look at the consolidated piece for this quarter, there is a 1,500 crore income versus standalone or 1,200. What is that 300 crore attributable to? And secondly, your guidance of about 4,500 crore, do you see any sort of risk to that given what’s happening with crude and Henry Hub, or or you think you think this is a locked in number for the full year? Thank you.

Arkajan, Director Finance, Gale India Limited: So it’s it’s it’s GaleGas, which we have incorporated line by line. That’s the difference.

Unnamed Speaker, Finance Team, Gale India Limited: Okay. So it’s and that’s not captured in the CGD business there?

Arkajan, Director Finance, Gale India Limited: Actually, this year, we have regrouped the, marketing and CGD business of Gale Gas. Earlier, it was getting depicted in CGD. So we have regrouped, and bulk sell, we have considered in marketing.

Unnamed Speaker, Finance Team, Gale India Limited: Understood. That’s very helpful. Yeah. The second on your guidance for 4,500 crore of marketing. I mean, is there any risk?

And how should one think about the volatility in Brent and Henry Hub impacting the business, or have you logged it with this number for the full year?

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: So while risk is there, and the risks were there in the current year also and even the previous years. But we are confident that with our portfolio, which is well diversified, both oil and as well as HH Link, I think we are we are very pretty sure that we will be maintaining as part of our guidance of 4,000 to 4,000 crores in the coming years also.

Unnamed Speaker, Finance Team, Gale India Limited: Understood. And lastly, if you can talk about where is the additional volume growth coming for your transmission business?

Unnamed Speaker, Participant: K.

Arkajan, Director Finance, Gale India Limited: So JMSR has, during in opening remarks, stated that we are expected to transmit on an average basis 38 to 39 MMS CMD. And we expect this volume natural growth of CGD business, which we expect around 5,000,000 increase will happen on country, level, it will be more, but since our share is around 70%, so we expect naturally that volume will come from there. IOCL Baroni, one point three m eight SCMD, then Paradeep, two point three five SCMD. IOCL Haldia, zero point five. IOCL Banguayang, zero point two.

Guwahati, IOCL, point two. IOCL, Panipat, requirement of 1.79 during 2526. Earlier, we there was a requirement of 1.3. We decreased it to one one point seven nine. So 1.79 from this.

So these are the areas from where we expect that these volumes will come. Apart from the commissioning of new pipeline, chairman stated Mumbai Nakul Jarsukha, Shirkakula Mangul, there, certainly, we’ll be having more customers.

Unnamed Speaker, Finance Team, Gale India Limited: Understood. That’s very helpful. Thank you so much.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Great. Thanks, Puneet. We have the next question from Nitin from Phillip Capital. Nitin, please ask your question.

Nitin, Analyst, Phillip Capital: Hi. Good morning. Thanks for the opportunity, sir. So my question is related to your transmission segment. In this quarter, we had a drop of load by MMS in the last two to previous quarter.

So if you can help us understand that that declining volume was there. And then when we see the guidance for, basically, FY twenty six, we’re talking about almost, like, you know, in ’18 MMSMD, we we have exited quarter four. So, I mean, like, you know, in in the in the backdrop of the volume decline that we’ve seen in this quarter, does our guidance stand? And and then, basically, in relation to that, how was the first quarter going for us as far as contribution volume is concerned?

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Transmission. Actually,

Arkajan, Director Finance, Gale India Limited: I understand you’re asking regarding transmission volume.

Sanjay Kumar, Director of Marketing, Gale India Limited: Yeah. That we can explain. Right?

Arkajan, Director Finance, Gale India Limited: We had given guidance of 30 m 29 to 30 MMSMD during last earning call. Based on our assessment, that will be somewhere around 29 to 30 MMSCMD. And on yearly basis, we are less by two and a half MMSCMD if we even if we consider, you know, the 30 s c m d. And the this particular quarter you are talking about, there is certainly a drop of five s c m d. Largely, it has come down.

3,000,000 volume of shippers has come down. IOCL, one point five and BPCL, point eight. And this is coming down because they are shifted to liquid fuel because this quarter, there is a there is a drop in price of liquid fuel, so they switched over. And in our marketing volume also, there is a drop. KFCL was down during January 25, and also there were unplanned shutdown by HURL, Fulpur, RCF, Thal.

These all totally led to volume of four to five SCMD if you compare with the ’3 this year. So these are the specific regions, unanticipated shutdowns by fertilizer plant, and shippers volume came down because of the reduction in the crude price.

Nitin, Analyst, Phillip Capital: Great, sir. That, that’s my point.

Arkajan, Director Finance, Gale India Limited: How Sorry. Chairman also just reminded me. The GIGL volume also, got shifted because the we were supplying to Panipat Refinery through our pipeline, and then PNGR will between authorized GIGL. And from January onwards, that volume also got shifted to, GIGL pipeline.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Now our appeal is pending.

Nitin, Analyst, Phillip Capital: Yes, sir. So, basically, just a clarification on that. So how’s our first quarter volume going? That is one. And secondly, when chairman sir pointed out, like, you know, our volume guidance, then I think I see I will see the final part was also included in that guidance.

So, I mean, given that now they’ve shifted to GIGL. So, I mean, does that, guidance continue, or do we have to let you know, take that out from from our volume resolution?

Arkajan, Director Finance, Gale India Limited: No. When chairman gave guidance, GIGL volume, we have not considered.

Nitin, Analyst, Phillip Capital: So there was a volume number given out for Panipad refinery. Right? The which is there in the guidance. So that’s that is the one which is getting carried in GIDL’s number, I suppose. Okay.

Arkajan, Director Finance, Gale India Limited: Yes. Yes. We are not considered.

Nitin, Analyst, Phillip Capital: And so how’s the first quarter going? I mean, this quarter?

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Okay. Trust me.

Sanjay Kumar, Director of Marketing, Gale India Limited: Some plants are presently having a plant shutdown, and the power demand, which was expected last year, it was very heavy power demand in May. That demand is slightly muted. So we presently, we are within one twenty five, one one 20 to one twenty five, one 20 seven MMS CMD zone. But we hope to pick up on this transmission volume very shortly as soon as the maintenance is over, and we expect some power demand also to come next by next week.

Nitin, Analyst, Phillip Capital: And as Sure. Just spoke

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: DF that certain plants will start taking gas as soon as the connectivity to them is completed. So perhaps the first quarter itself may not be a sufficient guidance for the full year volumes.

Sanjay Kumar, Director of Marketing, Gale India Limited: So what what my CMD is telling, this all is about the pipeline groups in the Eastern India, JHBDPL and the Baroni Guwahati section going up to Guwahati. All many consumers are getting ready there. And in a in a short time frame of one or two months, lot of transmission volume may come up.

Nitin, Analyst, Phillip Capital: So we expect, like, you know, by the end of this quarter of our last June and July, more volumes would pick up. That’s the right summary, sir?

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Yes. Yes.

Nitin, Analyst, Phillip Capital: Alright, sir. Thanks so much for the answers, sir. I’ll get back in the

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Great. Thank you so much. We have the next question from Malik Patel. Malik, please go ahead.

Malik Patel, Analyst: Yeah. Hi. Am I audible? Yeah. Thanks, chairman.

Thanks, director finance and marketing for the opportunity. A few question. On the CapEx side, what is the guidance which we are giving for the FY ’26? And given your couple of large projects, particularly pet chem, we are finishing the CapEx this year, almost around 18,000 to 20,000 per hour by CapEx, which we planned a couple of years back. And if it is Mumbai, Nagpur pipeline, and others are getting complete.

In future, is the CapEx is going to shift more towards net zero and renewable side?

Arkajan, Director Finance, Gale India Limited: Actually, at ’26, we expect to have capital expenditure of around 3 INR 10,000 crore and largely it will be on petrochemical and pipeline around INR 3,000 crore each and then net zero as you also stated more than INR 1,000 crore rupees And operational CapEx, we incur every year around $151,600 crore will be around that. And then city gas distribution and, other small like LNG and CPG projects.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: And Sir,

Malik Patel, Analyst: any update on the MP CapEx? Sorry. Please.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: And you are correct that, most of our petrochemical projects and pipeline projects are getting completed within this financial debt, 2526. So we have besides the CapEx which we have mentioned on renewable net zero initiatives, We have sought authorizations on of several pipelines, which are pending along the East Coast of the country and several others which were not completed by other entities. And hopefully, we should get those those authorizations on nomination basis. And we expect that our CapEx pipeline will be strong in executing those pipelines in future.

Malik Patel, Analyst: Got it. Got it.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: You asked about

Malik Patel, Analyst: So any update on that MP? Yeah.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Yeah. Yeah. We we have not yet decided on that particular project. It’s still we we will inform you in due course of time. Yeah.

Sure.

Malik Patel, Analyst: So second question is on on a marketing side of LNG. And, see, in the country, you, IOC, GSPC, Arcelor, HP, they all done some around $67,000,000 ton of, medium term LNG contract linked to the HH and oil, which most of them will start some of them will start in this calendar year. Some of many of them will start in next calendar year. Now that if I look at this combined volume of all those, I mean, this medium term contract can be in the range of around 25 to 27 MMS CMD. My question is that will this expand overall kitty, which the country currently has, or lot of this volume will just replace, the spot in the market, which is we import approximately, what, seven, eight million ton of spot for LNG in the market.

Will that replace, lot of spot, or it will actually expand the kitty?

Arkajan, Director Finance, Gale India Limited: Important

Sanjay Kumar, Director of Marketing, Gale India Limited: aspect of the market gas market in the country. We believe market is actually an evolution, and this is the process where we used to have three or four importers up to ten years ago. Today, we’ve got about 12 importers who are, you know, importing LNG cargoes into the country. Most of these importers are actually working on new projects also. Whether it is AM and S, they are they have already started another project in the Eastern Side, I think, Paradeep or some other place, or the Puck Fertilizer, which signed another medium term contract that you you were referring to.

Everybody is actually, you know, trying to invest in a new facility, and for that, they are sourcing some some niche contracts. There are certain, you know, initiatives that they are taking, whether they’ll be able to manage those volumes or not. But they have taken that plunge, and this this is the way the market develops. You know, at Gale, we we take pride in the the way we have developed the the systems here. We are the torch bearer in this field.

We do whatever we do, others follow in three months, six months, one year, three year, five year. You know, we did a five year transaction, which you referred to. We started the supplies receiving supplies last month. Others have now come up with with the similar structure. We believe this will expand the market.

You know, the the consumption of gas in the country will grow on account of these new contracts.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: And to add to what Sanjay ji has just mentioned, I believe pointedly on your question, it is both. It is a placement of spot volumes because of the volatility which has been seen in the past. So everybody wants to have a a sort of a certain price. And it is also to take care of the growth which is expected in the country. So it is both.

And the logic perhaps of the short medium term contracts is that everybody is perhaps wanting waiting to see more and more liquefaction plants coming in US and the global growth, which part of which perhaps will then have some effect on the price levels and the formulas also.

Malik Patel, Analyst: Got it. Siru, just last question. This is on the petchem side. Given that, the spread has been very weak in the last, one one and a half year and, the the price of the most of the pet cams are at at a multiyear low. And our big big CapEx is also getting commissioned in this financial year.

Do you think that this CapEx commissioning will probably or number one, at the operational level, do you expect to make it a breakeven on this current prices or the current spread? And, second question is that how much time you require to ramp up those, the facilities, particularly on the PDS side, which, which will probably commission in this, next two, three quarters.

Arkajan, Director Finance, Gale India Limited: There is a difference between the part of petrochemical and the PDSFPP you’re referring to. PDHPP is propane based facility. When we took the decision for putting this plant, we did this analysis for past several years, and we found that there is a good correlation between the propane as input and PDHPP as output. So the spread we envisaged at the time of, envisaging the project, we decided to do that our analysis and it still it holds good. So it is not going to be similar situation, which is you are experiencing in when when gas price goes up and petrochemical price goes down, and we expect those correlation in terms of the propane and PDHPP price will continue to happen.

And in terms of our capacity expansion, the first year, we expect that plant to run, after commissioning maybe for 70% level of capacity. And then second year, maybe around the 90% and then it may be at full capacity. That’s the normal trend of any any process plans.

Malik Patel, Analyst: Yeah. Thanks. Thanks, Pumura, answering my question. We should be able

Sanjay Kumar, Director of Marketing, Gale India Limited: You were asking about the ramp up. You know, we believe that the production of PP in the country in this financial year would be about 7,900,000 tons, and the consumption would be about 8,200,000 tons. So there is real, you know, scope for the plant to to ramp up. Our plant will be commissioned this year, and we hope to achieve full load, you know, after the usual teething period of three to six months.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: The profitability Thank you. Thank you

Prawal Singh, Analyst, ICSI Securities: very much.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: And the profitability metrics of our current petrochemical capacity is relevant only for the 60 kt addition in at Pata. Five Hundred kt at Usar, DF just explained that propane is the input there. And at Mangalore, One Point Two Five MTPA is a new product altogether, PTA.

Malik Patel, Analyst: Got it, sir. Thank you very much, and wish you good luck, sir.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Great. Thank you so much. We have the next question from Vivek. Again, please stick to two questions at a time. We have a very long queue here.

Thanks.

Vivek, Analyst: Sure. Thanks, for the opportunity. Thank you, management, for the chance. So number one, is on the CGD sector. The PNGRBs scenario analysis presents the CGD sector as one of the key drivers of demand growth, and they are very bullish.

They are projecting two two to three times demand from the CGD sector between now and 2030. My question is how confident is the management of this demand projection given that there has been some challenge in the increased input costs? And secondly, there’s also pressure from authorities, especially in the northern part of the country, to push for electrification mandates. In that light, what is your sense of the realistic volume growth rate that CGD can deliver and therefore drive overall gas demand growth? I’ll ask the second question after this answer.

Thank you.

Malik Patel, Analyst: We the

Sanjay Kumar, Director of Marketing, Gale India Limited: market is so big that EV push that you are referring to possibly, you are referring to Delhi, DTC, etcetera, and the new registration rules, the draft rules that they are you know, they have given out. We believe CGD sector is you know, because of the reach, because of the 307 geographical areas that we have that PNGRB has authorized, the demand in the country in CGD sector would definitely double or more than double in next seven, eight years. The current consumption in CGD sector is about 42,000,000 cubic meter per day, and it can easily reach hundred million cubic meter per day because the the EV would not affect the market, and the market is so big. You know, the need for transportation is there. CGD will its will play its own role.

EVs will play its own role. LNG as a fuel would also, for heavy duty vehicles, would play its own role. So one or two EV push in one or two would not affect the growth of CGD segment in the country. That’s our view.

Arkajan, Director Finance, Gale India Limited: Let me supplement our director of marketing. The the pressure will not be on gas based vehicles. It will be pressure will be on the other fossil fuels like petrol and diesel, in particular diesel. So that’s not a concern. And second, in terms of in order to give boost to this growth, there have been lot of actions being taken place on ground like chairman during opening remarks said that the PNGRV is also looking for reducing the tariff for city gas distribution network companies from John two, John three to John one.

That will certainly help in input pricing. And we also expect that as the business as we are moving forward, the gas will also come under GST. These two will certainly care of their input cost even if they have to compete with other fossil fuel.

Vivek, Analyst: Okay. Thank you. That’s very helpful. Just one fall a small follow-up. You’ve been talking about natural gas inclusion under GST.

Is there any update to share in that regard and any expectation on what the rate would be and how it would alter the demand scenario?

Arkajan, Director Finance, Gale India Limited: Thanks. So any any update on in terms of rate is difficult, but we expect the gas will come very soon in GST. That’s what we hear from the policymakers and power corridor.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: And Sure. Couple of years back, a consultant had suggested a revenue neutral rate of, around 12% for GST for GST to come for natural gas. And, in addition, pending GST, I you may be aware that several states have reduced the VAT rates on CNG, namely Andhra Pradesh and Assam, which comes to my mind immediately. Yeah.

Vivek, Analyst: Right. My last question is on the volume that got shifted to the other pipeline, the GIGL pipeline that got authorized. Would it be possible for you to comment on the volume shortfall that you’re facing because of that, and by when do you expect a favorable resolution on that front? And is this number part of your FY twenty six guidance?

Sanjay Kumar, Director of Marketing, Gale India Limited: So this matter is subjugous, and this well, we have in our recent analysis, we have taken away this volume from our guidance.

Vivek, Analyst: Okay. And how much is the volume, sir?

Sanjay Kumar, Director of Marketing, Gale India Limited: See, it used to be five to five and a half million cubic meter, which used to be we used to transport that to Dahadri, that has now reduced to about two and a half to 3,000,000 cubic meter per day. It will go down further. It may go down further.

Vivek, Analyst: Okay. Thank you very much.

Sanjay Kumar, Director of Marketing, Gale India Limited: A complex contractual arrangement, actually, which cannot be, you know, explained. There there are some other details also in this regard.

Vivek, Analyst: Alright. Thank you so much for the clarification. All the best. Yeah.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Great. So we have the next question from Prawal Singh from ICSI Securities. Prawal, please go ahead.

Prawal Singh, Analyst, ICSI Securities: Good morning, sir. Thanks for the opportunity. A couple of questions. Firstly, on the petrochemical business, you did mention about the pricing weakness that has been one of the drivers of lower profitability. But if I look at the current quarter, pricing, at least on a q o q basis, seems to be flattish.

It is more the increase in costs that has led to the decline in profitability, at least in q four. So just wanted your perspective on how you expect things to change even if pricing were to remain, let’s say, flattish. Can we expect any delta positive delta in terms of costs given that we’ll have a much larger capacity to play with in the next couple of years? And, you know, what impact it can have on costs and whether there are any sourcing cost advantages also because of the, you know, additional energy volumes that we are seeing now. Just your comments on that.

That’s my first question.

Arkajan, Director Finance, Gale India Limited: Still the input cost has gone on. And you must have followed that during quarter four, the handry up price, which gas we have allocated for Pata plant, the most of the volume Pata plant consumed belongs to Henry Hub category or index base. So that Henry Hub price has gone down abnormally. If you compare this year, largely, it remains around $3.5 to $4 per MMBtu, which was almost 50% last year. So we believe that the prices at this level are not going to continue.

It’s already started softening. So that will certainly help us in reduction on managing the cost for PATTA even if the output price remains same.

Prawal Singh, Analyst, ICSI Securities: Okay. And so right now, in terms of the gas that is being allocated or cost the cost being allocated to Petkin is almost entirely benchmarked to Henry Hub. Is that is my understanding correct?

Arkajan, Director Finance, Gale India Limited: Not not entirely. Most of the volume are Henry Hub linked. And we we optimize time to time, but most of the volume we are giving Henry Hub to this volume.

Sanjay Kumar, Director of Marketing, Gale India Limited: So it’s an operational matter, actually. We look at the cargoes, and we the optimum solution is provided for our petrochemical plant.

Prawal Singh, Analyst, ICSI Securities: Understood. Understood. The second question was with respect to the gas trading business. You gave a guidance what you have mentioned, of course, of a 38 to 39 MMS in terms of transmission volumes. So should we infer that gas marketing volume should sort of grow in tandem?

If I take the same sort of correlation with 27 MMS in the transmission, we did about a hundred and, a hundred and one odd MMS in the in reading. Is that a similar sort of volume we should, you know, look at for the 05/26?

Sanjay Kumar, Director of Marketing, Gale India Limited: Marketing, I I you know, separately. In transmission, our guidance is one thirty eight, one 40 eight, one 50 nine million cubic meter per day in next three years. In marketing, gas marketing, we expect to do volume of 8,000,000, hundred and 14. That is hundred and thirteen point seven million and one twenty point three million. These are our, you know, marketing projections.

Prawal Singh, Analyst, ICSI Securities: So with this kind of a growth, I understand that you’re reluctant to, you know, give a more specific guidance. But 4 and a half thousand crore, can we just assume that on the line of what has happened in the last couple of years, this is an absolute bear case to a very conservative guidance in terms of profitability from this segment?

Arkajan, Director Finance, Gale India Limited: Let me take this question, Prupal. We have been given the guidance what is possible at a minimum. If you have followed last three years guidance, we gave 3,000. We surpassed that. Then we gave 4,500 crore.

We achieved almost 6,000 crore. Last year, we gave guidance initially 4,000 to 4,000 crore, and again, we surpassed those guidance to 4,800 crore. That’s the history, and we continue to give you guidance. This is possible. So chairman, in opening remarks, said 4,000 to 4,500 crore, and we expect that to be achieved.

Prawal Singh, Analyst, ICSI Securities: Understood, sir. Last question,

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited0: if I

Prawal Singh, Analyst, ICSI Securities: can squeeze it in.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Do you mind

Prawal Singh, Analyst, ICSI Securities: the kind yeah.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Do you mind coming back? We have we have a long queue. I’m so sorry.

Prawal Singh, Analyst, ICSI Securities: Alright. No problem. Thanks. Thanks.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Yeah. Yeah. Thanks. So next question is from Bharat Rajan from Antique Securities. Yeah.

Bharat, you can go ahead, please.

Malik Patel, Analyst: Yeah.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: Thanks, Abhishek, and, thank the management for, the opportunity. So if you can provide the gray gas and the six GA volumes, and the breaker, in terms of COG and other gas, please. Was it was it audible?

Unnamed Speaker, Participant: Yeah.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Yeah. Yeah. Yeah. You’re audible. Yes.

Yes.

Arkajan, Director Finance, Gale India Limited: During last year in Gale Gas. Right? And the if you are interested in breakup, the bulk trading was 4.3 m m three seven MMS CMD. Supplies to top, task, repair, GM, zone on uni unified price basis, 1.27. And then PNG and CNG, 1.67 put together.

These are three three segments. PNG, CNG 1.67, Taj, triple Jim, down 1.27, and 4.37 bulk ready.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: This for full year or four q, sir? Sorry? This for the full year or for

Malik Patel, Analyst: fourth quarter?

Arkajan, Director Finance, Gale India Limited: Full year. If you are interested in q four, I can, give that also.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: Yes. Yes, sir.

Arkajan, Director Finance, Gale India Limited: So full year quarter four, the PNG and CNG were 1.81. The task revision was 1.34, and bulk trading 4.18. And total 7.33. It is almost in the same range.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: Okay. And this includes the six gs as well?

Arkajan, Director Finance, Gale India Limited: This is not including six GAs. Six GAs is still with Gale, so that volume will be shift added when as in when it is actually part of Gale. Yes. Today, it is not.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: Okay. In case you have those numbers, if you can please share that.

Arkajan, Director Finance, Gale India Limited: So presently Currently sorry.

Sanjay Kumar, Director of Marketing, Gale India Limited: Six GAs of Gale, they are we are marketing about point four to point four five s c m d of gas there. During Kumbu, we had the opportunity of marketing point 5,000,000 cubic meter also in many days, And our outlook is that these particular geographical areas would grow by about 25% volume every year, these six GAs. In the in due course, as my CMD announced, these may be this will be merged with GaleGas, but the volume projections are like that.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: Wait. No. Sorry. Out of the point four, what would have been the CNG, sir? CNG and domestication.

Sanjay Kumar, Director of Marketing, Gale India Limited: Is about point three one, point three point point three to point three three. Point three between point three to point three five MMS, CMD, and CNG.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: That’s good enough. My second question was on the trading business. When is that, like, you know, the shift to gas linked contract from oil linked contract? Last time you had highlighted, like, know, what is going on. What would be the proportion now, and are we really targeting a % complete shift?

Sanjay Kumar, Director of Marketing, Gale India Limited: No. We have very good balance of different kind of contracts. You know, we are having Brent is was used to be our main, you know, LNG index. Presently, as Indian crude basket, some sort of proxy of Brent is being used in the country also. And about more than twenty twenty two million cubic meter per day of gas that we receive is based on Henry Hub index.

We have also done some additional contracts on Henry Hub index. We believe in maintaining balance between HH index and the crude oil index.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: If possible, we’ll be able to share the

Sanjay Kumar, Director of Marketing, Gale India Limited: do not plan to shift completely to gas based index. That is what

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: Fair enough. So would you have the pro proportion currently? Would that help? Would that be available?

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Let me Vadarayan, but I am I fail to understand. But do you believe that perhaps we should move away from one particular index and do No.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: No. Definitely not. So in fact, like Because

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: I always felt that perhaps we have a great portfolio of having different, linkage gases.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: Listen. Just to put that into context, basically, we are only concerned about the, variability in terms of, the Henry of price movement direction vis a vis the crude price movement direction. So if you remember, history suggests that, like, you know, at at some point in time, had a problem, basically, because the crude prices have fallen very sharply, and hence, we had losses. We also made significantly higher profits when we had the crude prices remaining higher. So we just want to understand what is the exposure in terms of that risk and accordingly take a call on that.

That is all

Prawal Singh, Analyst, ICSI Securities: we wanted

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: to understand. Definitely not advocating one way or the other.

Arkajan, Director Finance, Gale India Limited: This question we have been answering in, almost every earning call. We have portfolio of almost 21 MMS CMD linked to Henry Hub. This had been a concern not today, maybe three years back. Now almost 19 MMS CMD of volume either we have marketed on back to back basis or allocated to PATTA. So that volume does not have any risk with respect to the change in prices with respect to crude.

Two ms, CMD volumes, certainly, we have open available with us, and we have good risk management managing capability. Recently, when the Henry Hub price went up and crude price went down, we took swaps, And that’s their their that’s how we locked our margins. So even for the volumes we market on index different than this, we have a ability to lock the margins. So largely, this volume is marketed on same index. Therefore, the you can see that the volatility is not coming.

But volatility is coming because not because of this. We have one more contract which has a nine months average on sourcing side and three months average on on marketing side. And there, we face cash flow issues. So we we have cash flow in terms of positive cash flow more than 2 and 2 and a half dollars some point of time when the when the prices were moving differently. So so that that is sometime bringing the volatility, but that should not concern you because we are that’s a cash flow issue.

So if you are not getting this year, certainly, you will get next year because average has to come to same level if you match that. So that is that is not an issue today. And in terms of the question you asked, what is the percentage? We have almost 43, 40 four percent based on Henry M.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited1: That’s very useful, sir. Thanks a lot.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Great. Thank you for that. So we have the next question from S Ramesh from Nirvabang Securities.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited2: Yeah. Thank you very much. So if you look at your guidance for marketing segment EBITDA, can you share what is the kind of assumption you’re making for India gas price and improved? Because The US and and she is talking about India going past $4 because of the demand for gas for the LNG production process. So what is your underlying assumption for any of gas price and the Brent crude price?

Arkajan, Director Finance, Gale India Limited: I just answered to the question of what, Rajan, that a handria price is almost not a part of this computation because we have marketed on same index. Only only around two SCMDO volume is open. So whatever Henry Hub price remains, we have sold to the customer on same index. That’s the pass through price.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Okay.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited2: And second, third is on the, double LNG terminal, with the breakwater coming in. Can you share what will be the ramp up in volumes and the impact on profitability for Punkhorn LNG?

Sanjay Kumar, Director of Marketing, Gale India Limited: Last year last financial year, about 21 cargoes were regasified there. This year, we expect, you know, as my CMD informed you that we are hopeful that the certificate will come within one week. So we expect to do about 34 to 36 cargoes this financial year in this terminal.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited2: So would that help you make profits there? What is the current trend in profitability there? I’m not able to hear you, sir.

Arkajan, Director Finance, Gale India Limited: Correct. Current year year current year current year, we we did not have the positive profit certainly because we imported, we we regasified only 21 cargoes. But as as we move to 34 to 36 cargoes, almost 15 cargoes if added, then it adds to the bottom line almost 300 crore rupees. So this year, certainly, we were not in positive because of the breakwater issue. But going forward, we will have positive positive bottom line from the scale.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited2: You very much, sir. Great.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Next question is from the line of from MK Global.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited0: Hello. Yeah. So just one question. So if I look into your tariff outlook, so we have this upcoming tariff hike. But beyond that, also, there are certain events like probably some of the new pipelines getting connected to the integrated network and also volumes flowing through the bid out pipelines where I think the tariff levels are much higher.

So do you see blended tariff trajectory also to continue growing for the next three, four years, or or do you see it more to be stable in the current scenario?

Arkajan, Director Finance, Gale India Limited: You’re asking of a unified tariff or integrated tariff?

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited0: Integrated tariff for Gale, I think I’m not sure if the Baroni Bhatti line has been, like, included there. And also Kochim Bangalore line once it gets commissioned, I think that will also be formed part of integrated tariff. So net net, do we see the blended tariff going up by these events? And also about some some color on that bid out pipelines. Yeah.

Yeah. Thanks.

Arkajan, Director Finance, Gale India Limited: Does not include the KKMBPL pipeline. Barong Barongi Guwati is a part of integrated tariff, but it does not include the KKMBPL pipeline and because it is not yet connected with the Bangalore. So once it gets connected, it will form part of integrated tariff and it will certainly significantly add to the bottom line for Gale. That is one part. And second, you are asking what are other factors.

So our tariff already we have submitted and that is under revision. And, once the tariff is revised, we expect the integrated tariff to go up from say 50 current level of 58 rupees. We have submitted 77 even on conservative side, consider $70.72 rupees that that also another increase which is available. And third increase is that, and now we are actually moving from, utilization of this pipeline from the level around 70%. As we move from 70 to 75, and we expect this to be available during financial year 2526, then we have ability to recoup our lost volume from December 22 because regulatory provision is that whatever volume we have not whatever pipeline capacity we have not utilized for last past years from the regulatory change, which has happened in December, we will have ability to recover those volume, those losses in future future years.

So as we are growing in transmission, so our ability to have more than regulatory rate of 12% will increase, and that we expect that it will happen from the at least financial year 2627.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Does that answer you or you wanted some more information?

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited0: Yeah. That that answers my question. Thank you so much, and all the best. That’s okay.

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Abhishek, you’re not audible.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Great. Thank you, Subhiri. We’ll take one last question from Durban, Dixit. Durban, please go ahead.

Unnamed Speaker, Participant: Yes, sir. Thanks for taking my questions, sir. I broadly want to know, sir, that reason for the normalization of the marketing EBITDA quarter to quarter. Because I recall this December quarter, you say is that if I remove the exception, so there are around 6,000,000,000 is the that time the EBITDA. And you broadly say $3.04 reasons that time that higher India prices, food, LNG sourcing was nine month average versus the selling price, three month average, and you sold more than that contracted amount.

So so I think what are the changes that happened that lead to the I mean, you have done the some repricing or done the more hedging or something changes the customers. That’s something broadly if you can explain the reason for the quarter quarter normalization.

Arkajan, Director Finance, Gale India Limited: Share that why our marketing margin had gone down, and you have covered all those regions that, one, we were overcommitted in the market. Normally, we expect the customer not to take at a % level, but sometime we experienced that and last quarter had seen those we experienced those things and that led to a reduction in Second, you also covered the nine months average versus three months average. And third, we also had some Henry Hub exposure when crude goes down, those were also impacting. But but this situation reversed during this quarter.

The the crude prices had recently gone down, but were almost in last quarter four was not that, the, drop was not there. So whatever significant amount we lost in q three, the this was not the case. And the volume which we actually, committed or committed of those experiences also we did not see in this quarter. Therefore, we arrive at a normative level of marketing margin, which is around 1,000 crore rupees to 1,200 crore rupee. That’s what we have seen in this quarter.

Unnamed Speaker, Participant: Yes. And so my second question is that you have given the marketing guidance of around hundred eight m m c m or seven m m c m d growth in the FY ’26, and then 12 m c m d growth over the next two years from ’26 to ’28. If I do the math, so this is equivalent to this year, almost 2,000,000 ton LNG. And then after that, for two years, it’s a 3,000,000 ton LNG. So can I safely assume that this is the something LNG contracts that you are confident that you are able to get?

I need to million ton around this additional and then 3,000,000 ton from ’26 to ’28.

Sanjay Kumar, Director of Marketing, Gale India Limited: Part of that volume, have already sourced. So and going forward, we continue to work on the market on a weekly basis. And whenever there is an opportunity, we would source those volumes. Our guidances are on. You know, the volume of 8,000,000 that we are expecting this year will materialize, and there are RLNG contracts.

The LNG contracts is one way of doing it. There may be other ways also.

Unnamed Speaker, Participant: Yep. Yeah. That’s from my side. Thanks.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Thank you so much. That will be the last question for today due to time constraints. So any closing comments before we end this call?

Sandeep Kumar Gupta, Chairman and Managing Director, Gale India Limited: Yeah. Thank you very much to all the participants. Ultimately, I want to say that transmission remains our biggest bet. And with increased transmission volumes supported by the growth in the country, commissioning of the new pipelines, connection of the new plants with the grid and revision in the tariffs of our integrated pipelines as well as the changes in the regulations, which will also give our us additional support for the isolated networks. This transmission income is the biggest bet.

And also, I believe our diversified portfolio in terms of price is very helpful for us to to sort of attain the guided numbers on the marketing margin side. And we remain very confident. As well as petrochemical prices are concerned, while we do not see a very great upside even if the prices are favorable, at the same time we do not see a very major downside also in Petrochemicals. It may largely be a range bound and that does not in any case impact largely on the profits because that is a miniscule component of our total game. So I’m very confident that from these levels, after attaining this highest level profit in the history of Gale, while this was also supported by a one time settlement from GMTS in quarter three.

But I’m confident that we’ll be able to maintain this performance in all times in future. Thank you very much.

Abhishek, Moderator/Analyst, Montreal Oswal Financial Services: Great. Thank you so much, everyone, and you can now disconnect your line. Have a good day. Thanks.

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