GAIL Guides For 10-12 MMSCMD Upside In Transmission Volume For FY25-27

Gail (India) Ltd. has guided a transmission volume of 132 million metric standard cubic metres per day in FY25, with an upside of 10–12 MMSCMD for the next two fiscals.

Given the demand for natural gas from city gas distribution companies, fertiliser and crude refineries, the volume is likely to see an upward trend in FY25 and the next couple of years, RK Jain, director-finance of Gail, said in an analyst call.

In the first quarter of this fiscal, transmission volume has already risen to 131.75 MMSCMD and is likely to sustain itself in FY25, he said. The volume is likely to grow to 142 MMSCMD by FY26 and 152 MMSCMD in FY27, according to him.

The gas distributor has guided for Rs 4,500 crore in marketing (Ebitda) margin, as compared with Rs 4,000 crore in FY24. "The margin (Ebitda) guidance is based on the market positions and shipping swaps we have undertaken till now. The guidance can be revised upwards or downwards depending on the performance in Q2," Jain said.

The marketing volume in Q1 FY25 was flat at 99.47 MMSCMD, as compared with 99.90 MMSCMD in the previous quarter. The domestic marketing volume, however, grew by 5 MMSCMD on the back of strong power demand, he said.

The company has around seven pipelines and a new JBF Petrochemical plant—now rechristened as Gail Mangalore Petchem Plant—where construction activities are going on and commercial operations are expected between FY25 and FY27.

The Mumbai-Nagpur-Jharsuguda pipeline and the Bokaro-Dhamra pipelines are expected to be completed in FY25, Jain said.

The capital expenditure planned for FY25 is Rs 11,450 crore, while for FY26, it is Rs 10,100 crore, with the majority of funds going towards petrochemicals and the pipeline business, followed by CGD and exploration businesses.

The company also expects around Rs 120–140 crore in annual profit before tax from the revision in LPG pipeline tariffs, effective Aug. 1, on a proportionate basis, he said.

In Q1 FY25, the company spent Rs 1,569 crore, with Rs 500 crore spent on pipeline and petchem business each, Rs 30 crore on CGD, and Rs 400 crore on other operational expenses.

Gail's consolidated net profit rose 77.5% in the first quarter of the financial year 2025, beating analysts' estimates. The net profit increased to Rs 3,183 crore in the quarter-ended June, as compared with a Bloomberg estimate of Rs 2,148.5 crore.