ATGL - Adani Total Gas

📊 NSE: ATGL 🏢 Miscellaneous 📅 Last Updated: 12/13/2025 17:51

💰 Financial Performance

Revenue Growth by Segment

Total revenue grew 11.5% YoY to INR 4,986.1 Cr in FY25 from INR 4,471.7 Cr in FY24. Q1FY26 revenue reached INR 1,498 Cr, a 20.9% increase YoY. Volume growth is the primary driver, with a CAGR of 18% from FY21 to FY25, reaching 993-1,000 MMSCM.

Geographic Revenue Split

Highly concentrated with 4 matured Geographical Areas (GAs) contributing ~70% of total sales volume in FY25. The Ahmedabad GA alone accounts for ~38% of total sales volume.

Profitability Margins

Operating margins are among the highest in the industry but showing compression. PAT margin stood at 13.06% in FY25 (INR 648-653 Cr) compared to 14.6% in FY24. The drop is attributed to lower APM gas allocations and higher reliance on costlier RLNG.

EBITDA Margin

PBILDT margin was 22.80% in FY25, down 245 basis points from 24.68% in FY24. Q1FY26 margins further compressed to 19.50% due to reduced domestic gas allocation. EBITDA per SCM is approximately INR 10.

Capital Expenditure

Planned capex of INR 8,000-9,000 Cr over the next 5-6 years starting FY26. Specific near-term outlays include INR 1,000 Cr for FY26 and INR 1,400-1,500 Cr for FY27 to develop 34 GAs.

Credit Rating & Borrowing

Maintains a strong credit profile with ratings from CRISIL (Stable), CARE, and ICRA. Interest coverage ratio improved to 11.3x in FY25 from 9.92x in FY24. Gearing remains low at 0.42x to 0.44x.

⚙️ Operational Drivers

Raw Materials

Natural Gas, specifically Administered Pricing Mechanism (APM) gas (46% of total requirement), Regasified Liquefied Natural Gas (RLNG), and High Pressure High Temperature (HPHT) gas.

Import Sources

Sourced domestically from Indian gas fields (APM/HPHT) and imported as RLNG from global markets through long-term contracts to minimize spot price volatility.

Key Suppliers

GAIL India Limited (supplies APM and NWG gas) and Reliance Industries Limited (supplies HPHT gas). RLNG is procured from multiple suppliers under long-term contracts.

Capacity Expansion

Currently operates in 34 GAs with 647-650 CNG stations and ~9.72-9.9 lakh PNG domestic connections. Expansion plans target the full operationalization of 29 new GAs won in the 9th, 10th, and 11th bidding rounds.

Raw Material Costs

Raw material mix shifted significantly; APM gas sourcing dropped to 46% in FY25 from 58% in FY24. This 12% shift toward costlier RLNG and HPHT gas increases the weighted average cost of gas.

Manufacturing Efficiency

Operational efficiency is driven by high scale and a strategic mix of 67% CNG (high margin) and 33% PNG sales.

Logistics & Distribution

Distribution is managed through a 25-year infrastructure exclusivity period for its city gas carrier networks, preventing competition from laying parallel infrastructure.

📈 Strategic Growth

Expected Growth Rate

10-15%

Growth Strategy

Execution of the Minimum Work Programme (MWP) across 29 new GAs. The company is leveraging its 50:50 JV with Indian Oil (IOAGPL) to access an additional 19 GAs. Growth is driven by increasing penetration in newer regions and the modular nature of capex where revenue starts shortly after infrastructure is laid.

Products & Services

Compressed Natural Gas (CNG) for vehicles, Piped Natural Gas (PNG) for domestic households, and PNG for industrial and commercial consumers.

Brand Portfolio

Adani Total Gas (ATGL), Indian Oil Adani Gas Private Limited (IOAGPL - Joint Venture).

New Products/Services

Expansion into newer GAs from the 11th bidding round is expected to contribute the majority of incremental volume growth in FY26.

Market Expansion

Targeting 34 GAs across 13 states including Gujarat, Rajasthan, Haryana, and Maharashtra. Expansion is focused on the 14 GAs won in the 11th round.

Market Share & Ranking

Ranked as the 5th largest CGD player in India by volume.

Strategic Alliances

Strategic 50:50 Joint Venture with Indian Oil Corporation Limited (IOCL) and a partnership between the Adani Family (37.4%) and TotalEnergies (37.4%).

🌍 External Factors

Industry Trends

The industry is shifting toward cleaner fuels; however, increasing EV penetration (target 30% by sales) poses a long-term threat to the CNG segment which currently drives 67-70% of ATGL's volume.

Competitive Landscape

Key competition arises from alternative fuels (petrol, diesel, LPG) and the potential entry of new players after marketing exclusivity periods expire.

Competitive Moat

Strong moat through 8-year marketing exclusivity and 25-year infrastructure exclusivity in authorized GAs. This creates a legal monopoly for the duration of the exclusivity period.

Macro Economic Sensitivity

Sensitive to Government of India policy to increase natural gas share in the energy basket from 6% to 15% by 2030.

Consumer Behavior

Shift toward environmentally cleaner fuels is driving a 15% YoY growth in gas sales volumes.

Geopolitical Risks

Global LNG price volatility due to geopolitical tensions affects the 54% of gas requirements met through RLNG and HPHT sources.

⚖️ Regulatory & Governance

Industry Regulations

Regulated by the Petroleum and Natural Gas Regulatory Board (PNGRB). Must meet Minimum Work Programme (MWP) targets for pipeline length and CNG stations or face penalties and performance guarantee encashment.

Environmental Compliance

Low environmental risk as natural gas is a cleaner fuel. ATGL has implemented water conservation and solar energy adoption across sites.

Taxation Policy Impact

Not specifically detailed beyond standard corporate rates; however, the company benefits from favorable government impetus on cleaner fuels.

Legal Contingencies

Potential penalties for delays in MWP targets across new GAs. Specific case values for pending litigation were not disclosed in the provided documents.