IGL's better than expected gross margins drive profitabilityIGL - 424 Change: 1.50 (0.35 %)
News: Revenue increased 154% YoY (and 32.7% QoQ) to Rs 3193.9 crore in Q1FY23. Sales volume stood at 7.9 mmscmd, an increase of 48.4% YoY and 1.9% QoQ. Gross margin was Rs 14.1/scm, flattish YoY better than estimate of Rs 13/scm. EBITDA was Rs 617.5, up 62.1% YoY and 23.4 % QoQ. The company reported PAT of Rs 420.9 crore, up 72.3% YoY and16.4% QoQ.
View: Results were better than expectations driven by gross margins whereas sales volume was in line with estimates. IGL reported better performance QoQ as gross margin increased Rs 1.5/scm owing to price hikes. In the current quarter (Q2FY23-TD), pooled gas price has been increased in August while global LNG prices are trading at elevated level. In the current quarter (Q2FY23E-TD), the company has further hiked domestic PNG prices. Volume growth coupled with steady margins will be important in the near term.