Adani Total Gas Q2 FY27: Revenue +34%, Margin Slides

Earnings snapshot: strong growth, weaker operating leverage

Adani Total Gas Limited (NSE: ATGL) presented its Q2 and H1 FY2027 results on October 23, 2026, covering the quarter and half year ended September 30, 2026. The update showed a business still expanding volumes and network reach across city gas distribution (CGD) markets. But it also highlighted a clear pressure point: profitability did not rise in line with revenue. ATGL reported double-digit growth in volumes and EBITDA in Q2 FY27, alongside sharp year-on-year revenue growth. The company attributed the operating momentum to sustained CNG demand, deeper PNG penetration, and network expansion.

Q2 FY27 financial performance: revenue growth outpaced profits

In Q2 FY27, ATGL reported revenue of INR 2,102 crore, up 34% year-on-year. EBITDA rose 12% to INR 340 crore, while profit before tax (PBT) increased 8% to INR 235 crore. Profit after tax (PAT) increased 3% to INR 167 crore for the quarter. The gap between revenue growth and profit growth was a central theme of the results narrative. ATGL also pointed to a challenging global energy environment during the period.

Separate reports around the same earnings cycle also cited revenue from operations of INR 2,109.65 crore and net profit of INR 173.27 crore for Q2 FY27. Another set of figures mentioned revenue from operations of INR 1,936 crore, EBITDA of INR 326 crore, and an EBITDA margin of 16.8% for the September quarter. ATGL’s presentation numbers, however, showed EBITDA margin at approximately 16.2% for Q2 FY27.

Margin compression: procurement costs rose 43% YoY

ATGL’s presentation indicated that a 43% year-on-year increase in natural gas procurement costs weighed on profitability. While revenue growth significantly outpaced volume growth, the uplift in topline was not fully translated into operating profit expansion. EBITDA rose 12% in Q2 FY27, but margins compressed to around 16.2%, compared with the company’s historical performance above 23% as cited in the presentation narrative. The results therefore reflected both pricing and cost dynamics at play in the quarter.

Volumes: CNG led growth while PNG rose modestly

Total gas volumes reached 315 MMSCM in Q2 FY27, up 12% year-on-year. The growth was driven primarily by compressed natural gas (CNG). CNG volumes rose 17% year-on-year to 223 MMSCM in Q2 FY27. Piped natural gas (PNG) volumes increased 3% to 92 MMSCM during the quarter. This mix mattered because CNG growth was the key contributor to overall volume momentum.

H1 FY27: revenue rose 31%, but PAT declined

For the first half of FY27, total volumes increased 13% year-on-year to 618 MMSCM. Revenue increased 31% to INR 3,999 crore, while EBITDA rose 3% to INR 621 crore. PBT declined 5% year-on-year to INR 414 crore for H1 FY27. PAT fell 7% to INR 300 crore, as stated in the company’s presentation table and accompanying narrative.

The volume split in H1 FY27 continued to show higher growth in CNG than PNG. CNG volumes increased 17% year-on-year to 441 MMSCM in H1 FY27. PNG volumes rose 4% to 177 MMSCM in the half year.

Network expansion: stations, households, and customer additions

ATGL continued to expand its CGD footprint and connections through the quarter. On a standalone basis, the company expanded its CNG network to 723 stations, adding 16 new stations during Q2 FY27. PNG home connections increased to 11.81 lakh after adding 39,574 households. Industrial and commercial connections rose to 10,864, with 442 new customers added.

The company also highlighted momentum in industrial and commercial connections in H1 FY27, stating it added approximately 900 customers during the half year. This took the industrial and commercial customer base to 10,864.

Scale with IOAGPL: wider footprint and combined volumes

Along with its joint venture partner IndianOil-Adani Gas Private Ltd (IOAGPL), ATGL highlighted a pan-India network reach of 1,185 CNG stations. The combined network included 14.31 lakh PNG household connections and 12,925 industrial and commercial connections. The pipeline network length was stated at 29,156 km.

Including the joint venture, ATGL reported combined CNG and PNG volume of 529 MMSCM in Q2 FY27, representing an 18% year-on-year increase.

Footprint and coverage: 53 geographical areas across 125 districts

ATGL reported it was operating across 53 geographical areas covering 125 districts, reaching 14% of India’s population. The company positioned its infrastructure buildout as a continuing priority even as input costs remained elevated. The operational update, taken together with the financials, showed the company prioritising scale and penetration while navigating margin pressure.

Key numbers table: Q2 FY27 vs Q2 FY26, and H1 FY27 vs H1 FY26

Why the results matter: balancing growth with costs

The Q2 FY27 performance underscored a recurring CGD sector challenge: keeping margins stable when input costs rise sharply. ATGL’s revenue growth of 34% in Q2 FY27, alongside volume growth of 12%, suggested a combination of higher throughput and pricing actions to manage inflation in gas costs. However, the EBITDA increase of 12% and PAT increase of 3% showed that the cost headwinds were significant. For H1 FY27, the divergence became clearer, with revenue up 31% but EBITDA up only 3% and PAT down 7%.

At the same time, the operating metrics pointed to continued scale-up in stations, household connections, and industrial and commercial customers. The company’s disclosures therefore presented two parallel tracks: expanding distribution and consumption, and managing profitability under a higher procurement-cost regime.

Conclusion

ATGL’s Q2 and H1 FY27 disclosures showed strong volume growth, steady network expansion, and sharp revenue gains, alongside compressed EBITDA margins and weaker profit progression. The presentation dated October 23, 2026, put procurement-cost inflation and a challenging global energy environment at the centre of the margin story. Over the half year ended September 30, 2026, ATGL continued to add CNG stations and PNG connections and increased industrial and commercial customers. The next set of quarterly updates will indicate whether cost pressures ease and whether operating leverage improves as volumes scale further.