Adani Total Gas Limited, a joint venture between Adani Group and TotalEnergies, has reported a 17% decline in its net profit for the fiscal year 2022. The company’s net profit stood at ₹1,231 crore (approximately $164 million) compared to ₹1,494 crore (approximately $197 million) in the previous fiscal year.
The decline in profits can be attributed to the reduction in APM (Arm’s Length Tariff) gas prices, which is a key factor that affects the company’s profitability. The APM gas price is set every six months by the Petroleum and Natural Gas Regulatory Board (PNGRB). The recent reduction in APM gas prices has resulted in a significant decline in Adani Total Gas’s revenue.
The company’s revenue from operations declined by 13% to ₹6,652 crore (approximately $874 million) in the current fiscal year, compared to ₹7,643 crore (approximately $994 million) in the previous fiscal year. The decline in revenue is mainly due to the reduction in gas prices, which has impacted the company’s profit margins.
Despite the decline in profits, Adani Total Gas has reported a 14% increase in its gas sales volume, driven by its expanding customer base and increasing demand for natural gas in various industries. The company’s gas sales volume stood at 2.3 million standard cubic meters per day (mmscmd) in the current fiscal year, compared to 2.1 mmscmd in the previous fiscal year.
Adani Total Gas is one of the leading natural gas distributors in India, operating in multiple segments including industrial,commercial, and residential sectors. The company is exploring opportunities to diversify its customer base and expand its revenue streams beyond the traditional industries it serves.
In a statement, Adani Total Gas Managing Director, Pransh Bedekar, said that the company is committed to providing reliable and efficient gas supply to its customers despite the challenges posed by the reduction in APM gas prices. He said that the company is exploring ways to mitigate the impact of the price reduction and is working on increasing its scale and diversifying its revenue streams.
Overall, Adani Total Gas’s decline in profits can be attributed to the reduction in APM gas prices, which has impacted its revenue and profit margins. However, the company’s efforts to expand its customer base and diversify its revenue streams may help it to recover from the current profitability challenges in the future.