Synopsis:
Gujarat Gas posted a sequential rise in profit and margins for Q1FY26 despite lower revenue, with record CNG volumes and expanding household reach supporting operational performance. The company’s entry into the Propane/LPG segment and its new industrial PNG agreement with Waree Energy reinforce its long-term growth strategy.
A city gas distribution stock edged higher after the company reported sequential improvement in profitability and margins during the June quarter, supported by record CNG volumes and network expansion. The management’s move to diversify into propane/LPG sales further strengthened investor sentiment.
Gujarat Gas Ltd, with a market capitalisation of Rs. 29,380.49 crore, opened at Rs. 427.80 against a previous close of Rs. 423.85. The stock touched an intraday high of Rs. 432, gaining 1.92 percent during the session.
What’s the News?
Quarter-on-quarter, revenue from operations declined by 5.2 percent from Rs. 4,288.98 crore in Q4FY25 to Rs. 4,065.41 crore in Q1FY26. However, profit before tax increased by 13.3 percent from Rs. 389 crore to Rs. 441 crore. Net profit also improved by 13.9 percent from Rs. 288 crore to Rs. 328 crore. Operating margins expanded from 11 percent to 13 percent sequentially, reflecting improved efficiency.
Year-on-year, revenue fell by 12 percent from Rs. 4,614.83 crore to Rs. 4,065.41 crore. Profit before tax was nearly flat, declining 0.7 percent from Rs. 444 crore to Rs. 441 crore, while net profit dipped by 0.9 percent from Rs. 331 crore to Rs. 328 crore.
Also read: Infra stock skyrockets 13% after company’s net profit increases by 105% YoY
Operational Highlights
The company recorded its highest-ever CNG volume of 3.33 mmscmd during the quarter, up from 3.22 mmscmd in Q4FY25. On a year-on-year basis, the CNG segment registered a 12 percent growth, driven by Gujarat Gas’s expanding infrastructure, which now includes a network of 830 CNG stations. In Q1FY26, the company also added over 35,000 new domestic PNG customers, taking its total household connections to over 23.02 lakh.
During the quarter, industrial sales volumes stood at 4.71 mmscmd, followed by CNG at 3.33 mmscmd, PNG Domestic at 0.69 mmscmd, and PNG Commercial at 0.14 mmscmd. Additionally, Gujarat Gas is scaling its retail distribution through the FDODO (Full Dealer-Owned Dealer-Operated) model and has signed 69 FDODO agreements with various dealers to enhance reach and improve operational efficiency across markets.
In line with its vision to become a total energy solutions provider, Gujarat Gas announced its entry into the Propane/LPG business, with plans to source and sell Propane/LPG to industrial customers. The company said this aligns with its long-term strategy and reinforces its customer-centric approach in catering to diversified energy needs.
Recent Collaboration
On July 31, 2025, Gujarat Gas signed a Gas Sales Agreement with Waree Energy to supply 50,000 scmd of PNG to the latter’s upcoming lithium-ion cell manufacturing unit in Valsad, Gujarat. The plant is expected to be commissioned in Q4 FY25–26 and will contribute to sustainable energy adoption in the region.
About the Company
Gujarat Gas Limited is India’s largest city gas distribution company, operating a network of over 43,300 km of pipeline across six states and one union territory. In Q1FY26, it distributed approximately 8.88 mmscmd of natural gas and provided services to over 23.02 lakh households. The company manages 830 operational CNG stations and has over three decades of experience in uninterrupted gas distribution.
Written by – Manan Gangwar
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