Gujarat Gas Ltd Q4 FY26 Earnings Call: Summary, Management Commentary & Outlook

Gujarat Gas Ltd held its Q4 FY26 earnings call on May 30, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record CNG Volumes & Scheme Completion Mark the Quarter

• FY26 EBITDA of Rs.3,772 crores— up 16% YoY from Rs.3,241 crores in FY25, driven by gas trading and CGD strength.
• FY26 PAT of Rs.2,299 crores— marginally lower than Rs.2,308 crores in FY25, reflecting one-off items in the base period.
• Q4 FY26 EBITDA of Rs.943 crores— versus Rs.790 crores in Q4 FY25, a 19% YoY increase.
• Board recommended dividend of Rs.8.9 per share (445%)— reflecting strong cash generation in FY26.
• Record Q4 FY26 CNG volume of 3.6 MMTPA— up 12% YoY; cumulative vehicle base reached 17.68 lakh (+15% YoY) with 839 CNG stations.
• Scheme of arrangement effective 1 May 2026— GSPC, GSPL, and GSPC Energy merged into Gujarat Gas (now Gujarat Energy Ltd). Additional share listing expected in 7–10 days; GTL demerger listing by end-July 2026.
• PNG industrial volume in Q4 FY26 was 4.19 MMTPA (down from 5.03 MMTPA in Q4 FY25)— though up 7% QoQ from Q3 FY26, indicating sequential recovery.

Gas Trading and CGD Deliver Robust EBITDA; Power Remains a Drag

• FY26 full-year segment EBITDA— gas trading Rs.1,300 crores, CGD Rs.1,900 crores, exploration & production (ENP) Rs.29 crores, renewables Rs.46 crores.
• Q4 FY26 segment EBITDA breakdown— gas trading ~Rs.400 crores, CGD ~Rs.450 crores, ENP ~Rs.14 crores, renewables ~Rs.5 crores.
• CGD segment EBITDA per SCM of 6.16— for FY26, excluding the impact of amalgamation; management noted any sourcing advantage from Gujarat Energy will flow through but did not quantify future margin uplift.
• Gas trading margin runs at 4%–6%— on blended imported LNG and domestic gas; per-unit margin not disclosed separately.
• ELP (exploration) segment operating profit of Rs.29 crores in FY26— after depreciation the segment reports net losses; 2P reserves stand at 6.71 million BOE (unchanged).
• Power business reported losses in FY26— plant load factor (PLF) was 1% for GPPCL and 6%–6.5% for GCG; forex losses of Rs.15 crores (GSCG) and Rs.23 crores (GPPCL). Management is exploring a revival strategy for the 1,000 MW capacity with no timeline provided.
• Gas trading EBT of Rs.1,334.61 crores in FY26 (vs Rs.1,222 crores in FY25)— despite trading volumes declining 19% YoY to 10.2 MMSCMD (net 4.9 MMSCMD after inter-segment).

Long-Term Contracts Lock In Supply; Propane Disruption Boosts Industrial Volumes

• Morbi ceramic cluster volume of 2.02 MM SCMD in Q4 FY26— up 21% QoQ; current (Q1 FY27) Morbi volumes run at ~8 MSCMD with customers indicating a potential peak of 8.8–8.9 MSCMD.
• Current Morbi pricing at Rs.75/SCM— non-Morbi industrial at Rs.68/SCM (Q1 FY27). June 2026 Morbi price increased by Rs.1.5/SCM to ~Rs.77–Rs.78/SCM; management confirmed they do not sell at a loss.
• Management signed two long-term LNG SPAs aggregating 1.36 MTPA— QatarEnergy (1 MTPA, ramp from FY27 to FY29–30) and Uniper (6 cargoes/yr, FY28–29 to FY36–37). Existing Qatar contract expires FY27–28 and will be replaced by higher-volume contracts.
• Existing long-term LNG portfolio of 2.6 MMTPA— supplemented by Total Energies (6 cargoes/yr, FY27 to FY34–35) and Shell (15 cargoes/yr, expires FY29–30). Fertilizer sales contracts run till FY27–28; management pursuing extensions.
• Two LNG cargoes lost in May and June FY27— due to West Asia conflict, confirming near-term supply disruption; management is actively seeking Henry Hub-linked volumes for stable pricing.
• Management evaluating propane business entry— discussions underway with port authorities in Gujarat for dedicated infrastructure and with Qatar Energy and Saudi Aramco for import contracts (period unspecified).Propane is currently unavailable at normal levels, supporting Morbi gas demand.
• GSPC Mundra regasification facility utilization improved— 17% in FY26; reached 35–38% in May 2026 (FY27); management expects similar levels in June–July 2026.

Rs.1,900 Cr Tax Loss Buffer Remains; McKinsey Engaged for Cash Deployment

• Cash on books of ~Rs.6,000 crores at end-FY26— plus other financial assets aggregating ~Rs.6,800 crores (including long-term fixed deposits and GSFS funds).
• Tax loss carryforward balance of Rs.1,900 crores as of end-FY26— from an original Rs.7,200 crores; Rs.2,800 crores absorbed in FY25 and Rs.2,500 crores in FY26. Management expects no tax to be paid on profits up to this amount, with the balance usable within eight years.
• Rs.900 crore tax refund due— on past losses set off, but timing depends on Income Tax Department assessment (period unspecified).
• Capex guidance for FY27— ~Rs.1,000 crores for the CGD business and ~Rs.100 crores for ENP drilling wells.
• Dividend payout of ~Rs.900 crores expected in FY27— normal annual capex guided at Rs.800–Rs.900 crores.
• McKinsey engaged for cash deployment strategy— update expected in Q1 or Q2 FY27; management also appointed McKinsey for a broader growth strategy evaluation.
• GSPC LNG stake increased from ~14% to 36.8%— due to conversion of outstanding into equity, making it a subsidiary as of FY26; total investment in GSPC Mudra LNG stands at ~Rs.1,700 crores (38% stake).

Recurring Gas Trading Run-Rate of Rs.1,100–1,200 Cr; Morbi Tailwind Expected to Persist

• Gas trading recurring run-rate guidance of Rs.1,100–Rs.1,200 crores per annum— management guided this as the sustainable level going forward, noting FY26 included ~Rs.450 crores of one-off items (customs duty refund of Rs.250 crores and Petronet cargo diversion liability of ~Rs.200 crores).
• Near-term margin guidance for FY27— trading business at Rs.5–Rs.5.5 per SCM; TGD (city gas distribution) segment at Rs.5.5–Rs.6.5 per SCM. Management acknowledged ongoing volatility but expressed confidence in maintaining historical trading margins.
• Gas trading volumes expected to grow 25–30% by CY2030–2031— management stated "management expects gas trading volumes, currently 10–12 mmscmd (FY26–27), to grow 25–30% by CY2030–2031," driven by expected resolution of geopolitical conflict and reasonable prices.
• Management confident of sustained high gas sales in Morbi through FY27–28— they do not expect propane to return to normal levels in that period and believe gas can compete on price when it does. Morbi contracts are now signed monthly from mid-April 2026.
• Transfer pricing optimization between trading and CGD segments underway— management noted regulatory changes now allow inter-segment sales without arm's length pricing, providing flexibility. The extent of profit transfer will be determined over time.
• Captive power plant PLF turnaround contingent on spot LNG prices— management indicated the 700 MW combined cycle plant (PPA expires 2036) would turn around when spot LNG falls to $6–$7 per MMBtu; current spot is $17–$18/mmbtu.
• Next results expected in early August 2026— Company Secretary Sandeep Dave indicated the next interaction will cover Q1 FY 2026-2027.