- 25 Oct 2022
- ICICIdirect Research
IGL - 432 Change: -0.20 (-0.05 %)
Revenue increased 94.1%YoY and 11.3% QoQ to Rs 3554 crore in Q2FY23. Sales volume was 8.09 mmscmd, up 11.8% YoY and 2.5% QoQ. Gross margins declined 6.6% YoY and 11.2% QoQ at Rs 12.5/scm. EBITDA stood at Rs 527.5 crore, flattish YoY and down 14.6% QoQ. PAT was up 3.9% YoY (down 1.1% QoQ) to Rs 416.2 crore.
IGL had increased domestic PNG prices in Q2FY23 to pass on increase in pooled gas costs. In the current quarter (Q3FY23E-TD), the government increased domestic gas prices from US$ 6.1/mmbtu to US$ 8.57/mmbtu for old fields, and that for difficult fields was raised from US$ 9.92/mmbtu to US$ 12.46/mmbtu. The company has further hiked CNG and domestic PNG prices by Rs3 per unit in line with this development. However, these price hikes are not sufficient to pass on the rise in gas costs. Going ahead, the government is planning to set up a committee to review the gas pricing mechanism which would likely reduce the gas sourcing cost of CGDs. Volume growth coupled with steady margins will be key monitorable in the near term.