Adani Total Gas stock drops post Q2 results; YES Securities shares its view

Shares of Adani Total Gas Ltd fell nearly 1 per cent in Wednesday's trade after the Adani group firm said its consolidated profit rose 8 per cent to Rs 173 crore in the September quarter compared with Rs 160 crore in the corresponding quarter last year. Revenue from operations fell marginally to Rs 1,179 crore from Rs 1,135 crore YoY.

YES Securities said higher Ebitda spreads and peak CNG volumes drove the profitability for the Gautam Adani-led company. It said Adani Total Gas' Ebitda spreads at Rs 13.2 per standard cubic metre (scm) were higher than Rs 12.5 per scm in June quarter and Rs 11.8 per cin the September quarter last year.

The stock, however, fell 0.77 per cent to hit a low of Rs 560.45 on BSE. The sequential increase in Ebitda spreads, YES Securities said, was due to better gas sourcing. "CNG sales share was at 64 per cent against 65 per cent/59 per cent during Q1FY24/Q2FY23 due to weaker industrial PNG volumes on alternative fuel prices being lower," it said.

For the quarter, Adani Total Gas sourced gas from IGX and bilateral trades were executed; short-term contracts also supported gas sourcing, YES Securities said adding that Adani Total Gas also took advantage of falling LNG prices.

"The company volumes at 2.29 mmscmd (vs 2.18/2.08mmscmd in Q1FY24/Q2FY23) of which CNG volumes stood at 1.48 mmscmd, supported by strong network expansions. PNG volumes at 0.82 mmscmd stood lower than the peak of 1mmscmd. Industrial volumes were 0.59 mmscmd, impacted by weaker demand despite lower gas prices," the brokerage said.

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