India's Mahanagar Gas posts lower quarterly profit due to cost pressures

Indraprastha Gas

06/05/2025 15:41

May 6 (Reuters) - Indian city gas distributor Mahanagar Gas MGAS.NS posted a 4.8% fall in quarterly profit on Tuesday, as expenses cut into steady growth in volumes.

The state-backed natural gas distributor reported a profit after tax of 2.52 billion rupees ($29.9 million) for the quarter ended March 31, down from 2.65 billion a year earlier.

Revenue from operations grew 18.6% to 20.39 billion, while total expenses rose 24.2%.

For further earnings highlights, (click here)

KEY CONTEXT

Indian city gas companies like Mahanagar Gas, Indraprastha Gas IGAS.NS and Gujarat Gas GGAS.NS have been facing earnings pressure for the last couple of quarters due to reduced supply of cheaper, government-regulated APM (Administered Price Mechanism) gas. This has forced them to buy more expensive gas from the open market, squeezing their profit margins.

Mahanagar Gas, however, posted a 12.3% rise in total sales volumes, driven primarily by strong growth in its compressed natural gas segment.

Peer Indraprastha Gas reported a 9% fall in its quarterly profit from a year ago, hurt by higher expenses.

PEER COMPARISON

Valuation (next 12 months)
Estimates (next 12 months)
Analysts' sentiment
RIC
PE
EV/EBITDA
Revenue growth (%)
Profit growth (%)
Mean rating*
No. of analysts
Stock to price target**
Div yield (%)
Mahanagar Gas
MGAS.NS
12.30
7.29
12.17
5.19
Buy
17
0.89
2.21
Indraprastha Gas
IGAS.NS
16.36
10.77
6.31
3.33
Buy
14
0.91
2.72
Gujarat Gas
GGAS.NS
25.06
14.77
9.25
4.60
Hold
14
0.98
1.25

* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell

** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the PT

JANUARY-MARCH STOCK PERFORMANCE

-- All data from LSEG IBES

-- $1 = 84.2640 Indian rupees

Mahanagar Gas https://tmsnrt.rs/3GUlRqA

 (Reporting by Yagnoseni Das in Bengaluru; Editing by Vijay Kishore)

 ((Yagnoseni.Das@thomsonreuters.com;))