Petronet LNG standalone profit rises 53% despite 35% revenue fall

Petronet LNG Limited reported standalone profit after tax of Rs 1,235.40 crore for the quarter ended 30 September 2026, up 53% from Rs 805.75 crore a year earlier, despite revenue from operations falling 35% to Rs 7,200.35 crore. A 46% reduction in material costs was larger than the fall in revenue.

Why did Petronet LNG’s September-quarter profit rise?

Petronet LNG’s September-quarter profit rose because its cost of materials consumed declined by Rs 4,303.88 crore year on year, exceeding the Rs 3,808.78 crore fall in revenue from operations. Material costs were Rs 5,145.51 crore in the quarter ended 30 September 2026, compared with Rs 9,449.39 crore in the corresponding 2025 quarter.

In the September-quarter comparison, total income declined 34% to Rs 7,432.44 crore from Rs 11,246.25 crore, while total expenses fell 43% to Rs 5,773.34 crore from Rs 10,163.59 crore. Profit before tax consequently increased 53% to Rs 1,659.10 crore from Rs 1,082.66 crore, with no exceptional items reported in either period.

Petronet LNG’s tax expense increased to Rs 423.70 crore from Rs 276.91 crore, but profit after tax still rose to Rs 1,235.40 crore. Basic and diluted earnings per share were Rs 8.24 for the September 2026 quarter, compared with Rs 5.37 a year earlier, on paid-up share capital of Rs 1,500 crore.

How did Petronet LNG perform against the June quarter?

Petronet LNG’s profit after tax increased 9% sequentially from Rs 1,132.72 crore in the quarter ended 30 June 2026 to Rs 1,235.40 crore in the September quarter. Revenue from operations rose 30% from Rs 5,554.14 crore, while material costs increased 39% from Rs 3,699.29 crore.

The increase in total income exceeded the increase in total expenses in the sequential comparison. Total income rose by Rs 1,643.82 crore from Rs 5,788.62 crore in the June 2026 quarter, while total expenses increased by Rs 1,499.15 crore from Rs 4,274.19 crore; profit before tax therefore rose to Rs 1,659.10 crore from Rs 1,514.43 crore despite impairment loss increasing to Rs 134.66 crore from Rs 100.86 crore.

For the half year ended 30 September 2026, Petronet LNG reported revenue from operations of Rs 12,754.49 crore, down 44% from Rs 22,888.99 crore a year earlier. Half-year profit after tax nevertheless rose 43% to Rs 2,368.12 crore from Rs 1,656.33 crore as the cost of materials consumed declined 55% to Rs 8,844.80 crore.

Petronet LNG reports a single operating segment, Natural Gas Business, covering the import and processing of liquefied natural gas, or LNG. The half-year figures therefore do not include a comparison between separate operating segments, while total income for the six months was Rs 13,221.06 crore against Rs 23,368.44 crore a year earlier.

What does Petronet LNG’s September 2026 balance sheet show?

Petronet LNG had total assets of Rs 29,473.92 crore at 30 September 2026, up from Rs 26,882.41 crore at 31 March 2026. Total equity increased to Rs 23,637.78 crore from Rs 21,719.66 crore over the same six-month period, while total liabilities rose to Rs 5,836.14 crore from Rs 5,162.75 crore.

Capital work-in-progress increased by Rs 1,026.29 crore over the six months to Rs 3,523.43 crore, while property, plant and equipment declined to Rs 7,480.02 crore from Rs 7,610.99 crore. Current investments were Rs 806.83 crore at 30 September 2026, compared with nil at the previous financial year-end, and cash and cash equivalents rose to Rs 2,238.37 crore from Rs 1,858.93 crore.

Net cash generated from operating activities was Rs 2,914.37 crore in the half year ended 30 September 2026, compared with Rs 1,815.56 crore a year earlier. Investing activities used Rs 2,040.73 crore, compared with Rs 531.32 crore used in the previous-year period, including Rs 1,685.56 crore spent on property, plant, equipment and capital work-in-progress.

What receivables and vessel claims does Petronet LNG face?

Petronet LNG had gross Use or Pay, or UoP, dues of Rs 408.23 crore in trade receivables at 30 September 2026, with a Rs 230.72 crore provision reducing the net amount to Rs 177.51 crore. The dues arose from lower customer capacity utilisation under long-term regasification agreements and date from financial year 2022-23 through financial year 2025-26.

Petronet LNG waived UoP dues of Rs 252.80 crore during the September 2026 quarter and Rs 311.61 crore during the half year, charging those amounts to the statement of profit and loss. It said bank guarantees for outstanding UoP dues relating to calendar years 2023 and 2024 had been received under agreed recovery mechanisms, while management remains confident of recovery based on contractual obligations.

Petronet LNG also disclosed vessel-owner claims of Rs 625.42 crore plus applicable taxes at 30 September 2026, up from Rs 89.30 crore at 31 March 2026. Operations of its three dedicated LNG vessels were suspended from 2 March 2026, except for one vessel used for about seven days in June, following disruption to maritime navigation through the Strait of Hormuz and LNG loading operations.

Petronet LNG has made no provision for the vessel claims because, based on legal advice, it considers them not tenable under the relevant time-charter agreements. Vessel owners have initiated arbitration, which Petronet LNG is contesting, and both the auditor and Petronet LNG said the ultimate financial impact cannot presently be determined.

Conclusion

Petronet LNG’s September 2026 standalone results show that the Rs 4,303.88 crore year-on-year reduction in material costs exceeded the Rs 3,808.78 crore decline in revenue from operations. That cost movement produced quarterly profit after tax of Rs 1,235.40 crore, compared with Rs 805.75 crore in the year-earlier quarter, while half-year operating cash generation rose to Rs 2,914.37 crore.

The next disclosures to watch are progress in recovering Rs 408.23 crore of gross UoP dues under the agreed settlement mechanisms and developments in arbitration over Rs 625.42 crore plus applicable taxes of vessel-owner claims. Petronet LNG’s board also declared an interim dividend of Rs 7 per equity share with a Rs 10 face value at its 2 November 2026 meeting.