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Indraprastha Gas: Sales volume at 7.2 mmscmd, better than expected

News: Revenue increased 40.3% YoY (and 45.6% QoQ) to Rs.1831.2 crore as sales volume grew 31.6% YoY to 7.2 mmscmd. Gross margin declined Rs.0.2/scm YoY and Rs.0.8/scm QoQ to Rs.13.4/scm. Subsequently, EBITDA was at Rs. 530.2 crore, up 30.2% YoY and 39.2% QoQ. PAT was at Rs.400.5 crore, up 30.1% YoY and 64% QoQ.

Views: IGL results were better than estimates on account of higher volume. Sales volume improved with relaxations in restrictions during Q2FY22. In the current quarter (Q3FY22E-TD), the company has hiked prices to pass on increase in domestic gas costs. Further volume growth coupled with steady margins will be important in the near term.