Gujarat State Petronet Q2 Results Review - Weak Volumes, Tariffs Impact Core Performance: Yes Securities

Yes Securities Report

Gujarat State Petronet Ltd.'s Q2 FY25 performance presents a weak picture, Ebitda and profit after tax witnessed YoY de-growth of 53%/26.8%; Ebitda was down 35.9% on lower volumes and tariffs but PAT was up 83.6% QoQ on higher other income. Volumes at 29.68 million metric standard cubic metre per day was lower than our expectations of 34.1 mmscmd, on lower-than-expected volumes across sectors.

However, the tariffs at (Rs 0.831/scm) were lower than our expectations of (Rs 0.997/scm). In Q2 FY25, Gujarat Gas Ltd.'s volumes declined at large at Morbi which impacted the city gas distribution demand for GSPL. In Gujarat Gas’ recent concall, they have highlighted an increase of 0.6-0.8 mmscmd at Morbi uplifting volumes for GSPL in Q3 FY25.

While managing cost pressures remains crucial, weaker volume growth and lower tariffs, we maintain a Neutral rating on GSPL with a target price of Rs 434/share.

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