ATGL - ADANI TOTAL GAS LIMITED Share Price

In the earnings call for Adani Total Gas Limited on January 23, 2026, management provided an optimistic outlook focused on operational and financial growth. The key forward-looking points highlighted include:

1. Volume Growth: CNG volume increased by 17% year-on-year in Q3 and 18% over the 9-month period. PNG volumes rose by 3% in the quarter and 7% for the nine months, reflecting ongoing network expansion.

2. Infrastructure Expansion: The network grew to 680 CNG stations, with the addition of 18 new stations in Q3, and a robust pipeline infrastructure of 14,862 inch-kilometers. The domestic PNG consumer base reached 1.05 million homes, with around 35,000 new connections added in Q3 alone.

3. Financial Performance: Q3 revenue was INR 1,631 crores, a 17% increase, while the 9-month revenue was INR 4,692 crores, up 19%. Q3 EBITDA increased by 15% to INR 313 crores despite challenges, and profit after tax rose by 10% to INR 157 crores.

4. E-Mobility Progress: Adani TotalEnergies E-mobility Limited (ATEL) aims to establish 10,000 EV charging points and has installed almost 5,000 points across 226 cities, with a combined capacity of 51 megawatts.

5. Tax Benefits: The recent introduction of a 2% CST on natural gas has provided a cost advantage, supporting pricing strategies for PNG and CNG that aim to enhance affordability for consumers.

6. Commitment to Sustainability: The company improved its S&P Dow Jones Sustainability Index score to 72, positioning itself as a leader in the gas utility sector, and received CDP rating upgrades to category A.

Management affirmed a commitment to expanding the network, enhancing customer experience, and supporting India's energy transition by providing affordable lower-carbon energy solutions.

Major Questions and Detailed Answers

Question 1: PNGRB implemented 2-zonal transmission tariffs. What is the impact on our cost of gas? Is it an increase or decrease?

Answer: We see it as an overall positive reform. Transitioning from 3 zones to 2 zones has allowed us to apply a uniform zone 1 tariff of INR54 for a significant portion of our volume, which was previously under higher tariffs. While there is a minor increase in tariffs in certain areas, the net effect is beneficial overall. Our main priority remains to expand our consumer base and improve affordability, which led us to reduce PNG and CNG prices immediately, motivating consumers further.

Question 2: Could you share the CNG vehicle additions in our geographical areas over the last two years and the volume growth of new vs. old geographical areas?

Answer: In ATGL's geographical areas, we saw a CNG volume growth of 18% year-on-year. Over the last quarter alone, around 45,000 vehicles were added, reflecting 31% growth in vehicle additions. Our new geographical areas tend to show higher growth rates compared to the older ones as they are still evolving and developing their infrastructure, with many consumers transitioning to CNG vehicles.

Question 3: What is the share of corporate biogas blending in terms of volume on the APM gas side?

Answer: Currently, our blending from Corporate Biogas is less than 2%, with our total consumption seeing only about 1% blending. Although we produce CBG from our plants, the overall production is still significantly lower, and discussions are ongoing on its future integration into our APM gas portfolio.

Question 4: What is the mix of gas being used currently, and how has New Well Gas supply changed for CNG players?

Answer: Our gas portfolio comprises approximately 65% to 70% domestic gas from APM, New Well Gas, and HPHT. We have not seen significant depletion in domestic gas production recently, which is favorable for our operations. Last quarter, the anticipated reductions in New Well Gas supply did not occur, allowing us to maintain healthy sourcing levels.

Question 5: What expectations do you have regarding gas allocation or any cuts occurring come April?

Answer: We are not expecting substantial changes or cuts in allocation; the trend seems to be stable. Although there is no two-month advance notice requirement, we are managing without significant disruptions and expect our allocation to continue in the same manner as it has been.

Question 6: What is the target for the number of outlets to be added for the rest of this year as well as plans for the next?

Answer: Our current target is to continue expanding our CNG station network while closely monitoring volume traction. We'll see additional growth in both existing and new geographical areas. The focus remains on strategically rolling out CODO and DODO stations to enhance customer experience and support the growth of our consumer base.

Question 7: What is the average throughput per outlet, considering the various geographical maturity levels?

Answer: Throughput varies significantly by location. Established areas like Faridabad may handle 6,000 to 15,000 kgs daily, while newer areas could be as low as 500 to 2,500 kgs. Each station's performance correlates with its maturity stage; hence, it is vital to analyze them on an individual basis rather than generalizing across all locations.

Question 8: How do dealer margins work for DODO stations? What gives them comfort for investment?

Answer: For DODO dealers, factors like location and anticipated volume growth are critical. We ensure that they see the potential for good IRR over time. Our support in providing better locations and voluntary incentives encourages them. We are witnessing an overwhelming response for new CNG stations, indicating dealer confidence in our network expansion strategy and our technology's reliability.

Each answer provides clarity on operational strategies, market conditions, and future plans while emphasizing our commitment to consumer growth and operational excellence.