Adani Total Gas FY25 Revenue Jumps 12%, Profits Face Headwinds

Introduction

Adani Total Gas Ltd (ATGL) announced its financial and operational results for the fiscal year ending March 31, 2025, showcasing robust expansion and volume growth. The company reported a 12% year-on-year increase in revenue from operations, underpinned by a 15% rise in sales volume. Despite this strong top-line performance, profitability faced pressure, with standalone Profit After Tax (PAT) seeing a marginal decline. The results highlight a period of aggressive infrastructure expansion against a backdrop of challenging input costs, a trend that became more pronounced in subsequent quarters.

FY25 Financial Performance

For the full fiscal year 2025, ATGL's standalone revenue from operations grew to ₹5,398 crore from ₹4,813 crore in the previous year. The company's EBITDA remained stable at ₹1,167 crore, a slight 1% increase from FY24. However, higher operational costs and rising natural gas prices impacted the bottom line. Profit Before Tax (PBT) stood at ₹868 crore, a 2% decrease, while Profit After Tax (PAT) fell by 1% to ₹648 crore compared to ₹653 crore in FY24. The consolidated PAT for FY25, which includes joint ventures, was ₹654 crore.

Operational Strength and Network Expansion

Operationally, ATGL demonstrated significant growth. Total sales volume for FY25 reached 993 Million Metric Standard Cubic Meters (MMSCM), a 15% increase from 865 MMSCM in the previous year. This growth was largely driven by the Compressed Natural Gas (CNG) segment, where sales surged by 19% to 663 MMSCM. Piped Natural Gas (PNG) sales also grew by 7% to 330 MMSCM.

The company aggressively expanded its infrastructure footprint. During FY25, ATGL added 100 new CNG stations, bringing its total network to 647. The PNG network also saw substantial growth, with the addition of 142,301 new domestic connections, pushing the total household consumer base to over 962,000. The company's steel pipeline infrastructure expanded by 1,750 inch-kilometers.

Quarterly Performance Reveals Margin Squeeze

The fourth quarter of FY25 already hinted at emerging margin pressures. While Q4 revenue grew 15% YoY to ₹1,448 crore, EBITDA and PAT declined by 10% each, to ₹274 crore and ₹149 crore, respectively. This trend intensified in the following quarters of FY26. In the quarter ending September 2025 (Q2FY26), the company reported a 9% year-on-year drop in net profit, even as revenue climbed 19%. Management attributed this decline directly to a significant rise in input gas prices, which could not be fully passed on to consumers without impacting volume growth.

Key Financial Metrics (Standalone)

Management Commentary

Suresh P Manglani, ED & CEO of ATGL, commented on the performance, stating, "Team ATGL has continued its thrust to expand access of PNG and CNG to large masses. We have maintained momentum of delivering robust operational and infrastructure performance with a 15% year-on-year increase in volume." He acknowledged the challenges faced by the City Gas Distribution (CGD) sector regarding domestic gas allocation but highlighted the company's progress in new sustainable businesses as a key strategic focus.

Diversification into New Energy

ATGL is actively diversifying its portfolio beyond traditional gas distribution to align with India's energy transition goals. Its subsidiary, Adani TotalEnergies E-mobility Limited (ATEL), has installed 3,401 EV charging points, with 2,338 of them energized. This positions ATGL as a growing player in the electric mobility ecosystem.

In the biomass sector, Adani TotalEnergies Biomass Limited (ATBL) has stabilized Compressed Biogas (CBG) production at its Barsana plant and launched an organic fertilizer brand, "Harit Amrit." The company also commissioned its first Liquefied Natural Gas (LNG) station in Tiruppur, catering to the heavy-duty transport sector.

Market Context and Outlook

The company's strategic expansion and diversification have been recognized by rating agencies. During the period, credit rating agencies like ICRA, CRISIL, and CARE assigned or upgraded ATGL's long-term rating to 'AA+' with a stable outlook, reflecting its healthy financial position and expanded scale of operations. The outlook for ATGL remains tied to its ability to manage volatile input gas prices while continuing its network expansion. The growth in CNG and PNG demand is expected to remain strong, supported by government policies promoting cleaner fuels. The success of its new ventures in e-mobility and biomass will be crucial for long-term value creation and de-risking its business model from gas price fluctuations.