Ladies and gentlemen, good day and welcome to Adani Total Gas Limited Q3 FY25 investment day call. As a reminder, all participant lines will be in the listener's mode and there will be an opportunity for you to ask questions as the presentation concludes. If you need assistance during the conference call, please signal an operator by pressing the star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Parag Parikh, CFO, Adani Total Gas Limited. Thank you and over to you, sir. Thank you. Thank you and a warm welcome to everybody, to all our investors, analysts, funds, whoever are taking the time out and participating in today's third quarter earnings call of Adani Total Gas. I am pleased to share the operational and the financial results for ATGL for the quarter and the nine-month ending 31st December 2024. Let me begin with the physical highlights for the quarter. Our CNG station network has increased to 605 stations. We've added 58 stations for the year, and for the quarter-end results, we've added 28 new CNG stations. Of these 605 CNG stations, 116 CNG stations are CODOs or DODOs in terms of their format. Our steel pipeline infra has now increased to 13,000 kilometers. From the domestic pipe natural gas connections, ATGL is now serving over 922,000 domestic homes on pipe natural gas. For the year of nine months, we've added over a lakh connections, and for the quarter-ending December, we've added 28,677 connections. Similarly, for the industrial and commercial consumers, we have now reached 8,913 consumers by adding 582 connections for the nine-month period, while we've added 167 for the third quarter. Let me also give you an update on some of the other newer emerging businesses. On the e-mobility front, we are now at 1,914 EV charging points that have been commissioned across 22 states for undertakings in all 226 cities, and we aim to reach around 3,000 charging points by March to April this year. The presence of our EV charging points now has increased to almost 20 airports in the country. In fact, we are one of the largest airport EV charge point operators at this juncture. On the biomass business, ATGL has immense production and sales of the CBG from our Barsana plant, and we are hoping to enhance the same along with fermented organic manure, FOM, or the phosphate-rich organic manure PROM in the future. On the LNG side, our LTT business, we have commenced the first LNG station for long-haul trucks and buses in Tiruppur in Tamil Nadu, and a few more are at various stages of progress for commissioning. Let me also share with you the financial numbers for the quarter. During this quarter, the CGD industry faced a couple of reductions in the ATM allocation. So was the case for ATGL. The first reduction was on the 16th of October 2024, when our ATM gas was reduced from 63% to 51%. We once again faced a second round of ATM reduction from the 51% to 37% on the 16th of November 2024. Therefore, on an average basis for the quarter, the ATM allocation for the CNG segment specifically was at 47%. This shortfall, with the agility of ATGL, was met through our existing contracts, purchase of gas from the IGX spot market, as well as coupled with the allocation of the new well gas from the government, which allowed us to supply gas on a continuous basis. Like always, our focus has been to calibrate the end prices, balancing the affordability of end consumers and other stakeholders, including the profitability of the company. And I'm pleased to say that despite such challenges, ATGL maintained its growth trajectory, focusing on a customer-centric approach and delivered a robust operational performance with a notable 15% growth in volumes on a year-on-year comparable basis, of which the CNG volume increased by 19% to 171 MMSCM, while the PNG volume increased by 8% to 86 MMSCM during the quarter. Similarly, on a Q on Q basis, our volumes continued to rise by close to 6%. So the balance was formed in terms of continuing to push volume growth, while ensuring that there is a right price pass-through mechanism to the end consumers. On the financial front, for the third quarter, as compared to the previous quarter on a YOY basis, revenues from operations increased by 12% to INR 1,397 crore. Due to a reduction in ATM allocation and the increase in gas price, EBITDA for the quarter has been at INR 272 crore, while our PBT and PAT was at 193 crore and 143 crore respectively. Recently, with effect from 16th January 2025, ATM allocation for CNG has increased from 37% to 51%, and we expect to see some positive impact in this case in the current quarter that is going by. We are closely assessing the situation regarding the availability of ATM gas also going forward. In closing, I would like to say we remain committed to playing a leading role in India's energy transition journey by providing affordable, reliable, low-carbon energy for homes, transportation, commercial, and industrial users. I'd also like to acknowledge and be thankful to all our shareholders, stakeholders, analysts, funds, houses, consumers, dealers, suppliers, business partners, and all our employees for providing trust and continued support. Thank you very much. We could open the floor for question and answers. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment for the question queue to assemble. The first question is from the line of Yogesh Patil from Dolat Capital. Please go ahead. Thanks for taking my question. And, sir, congratulations for a very good set of numbers. I have a couple of questions. Sir, ATGL is consistently delivering 19% or more YOY growth in CNG volume over the last couple of quarters. What are the key factors contributing to the CNG volume growth? And if you could provide how many vehicles and daily basis you are supplying CNG, it would be helpful. Thank you, Yogesh, and of course, always with your active participation, CNG volumes have grown over a period of time, and we are seeing this in the context of affordable pricing, which has allowed CNG vehicles and volumes to continue to grow. As you are aware, when the ATM Committee had constituted an ATM price from last April, there was a cap of $6.5 as far as ATM price was concerned. This resulted in a visibility to the end consumers and therefore a proposition of continuing to convert into CNG consumption. I also request my colleague Rahul Bhatia to add on. Good afternoon. To answer the first part of your question, we supply CNG to about six to seven vehicles per day, and we are seeing a very robust growth in CNG, both in our existing GAs as well as our new GAs. Because we are expanding infrastructure in our new GAs, we are introducing gas, we are introducing CNG in new GAs. Because of that, we are seeing a very good growth in our new GAs, a very good reception to CNG. In addition to that, even in our existing GAs, we are seeing a very good growth. Just for your information, CNG vehicles, if I were to compare on a YTD basis for FY25 compared to FY24, in the whole of India, there has been a 43% growth in CNG vehicles. Even if we were to look at our GAs, we are seeing a very significant growth not only in the four-wheeler segment, but also in the LCV segment as well as buses, etc. To give you a perspective a little flavor in Ahmedabad, we are seeing that a lot of buses transferring over to CNG. From about five per month, we are going to about 28 per month of buses in Gujarat and Ahmedabad. So Rajasthan is also showing a very good increase, especially in Bhilwara. So we are very encouraged by the growth of CNG, both in the new GAs as well as existing GAs. I think to add to that, Yogesh, as you've seen, we have continued to build our network in the newer geographies, and the very expanse of building the network, reaching out in the newer geographies, has also added to the CNG volume. Can you quickly share, if you have the numbers, how many CNG vehicles monthly addition happens in your geographical area? That's one thing. And if you could provide us the geographical breakup of existing and the new geographical areas' contribution to the CNG. So right now, if I'm not wrong, 1.86 MMSCM kind of CNG, what we are selling. Out of that, how much is coming from the older GA and the newer GA? If you could provide that, it would be helpful. Okay. Would you want to add on to CNG vehicles, Rahul? Okay. So Yogesh, as far as the breakup is concerned in terms of contribution of CNG volume in the newer geographies to the existing geographies, the existing geographies are contributing 68%, whilst the newer geographies are contributing to the balance 32%. So that's the breakup as far as the overall volume is concerned. On the CNG specific volume, just a minute. I'll give you those numbers also. The CNG volume on an overall basis that is being contributed from the existing ones are close to about 1 million out of the 1.7 MMSCM. Okay. Fair enough. Second question related to, sir, overall, the government has recently increased allocation, as you mentioned, to the CNG segment up to 50%. Do you think the allocation of ATM gas to the CNG segment? That's one. And, sir, we wanted to understand the rationale behind the allocation of this ATM from the other segments like LTT or any other segments. Going forward, if required, from where we can see the CNG will get ATM gas? One second. Just one second, please. Hi, Yogesh. How are you? Yeah, I'm good, sir. Sorry, sorry. I I just came in from some other meeting. So what I have understood from last session's query, I'm just going to repeat and if you say yes. Basically, you are saying that since from 16th January, our ATM gas allocation for CNG has gone back to 51% roughly. You are seeking that whether it can go up further. If yes, what is the timeline? Is that your question? That is the question. And on the top of that, I just wanted to add one thing. What is the rationale behind restoring from other segments like LTT or any other power? I mean, we are not aware from which segment or the segment they have diverted gas to ATM side. So what is the rationale and logic that in long term, we wanted to understand that is it sustainable or not, first of all? And I mean. No, I understood your question. See, first of all, we need to understand that the vision of a government on CGD expansion and the development remains strong. So this is one thing. So that is the reason when the gas allocation went down or several constraints what government was working it out. What they did, while the ATM allocation went down, they brought a solution of a new well gas, which has a priority for the CGD. Similarly, we have HPHT allocation as a priority for the CGD. Higher prices, but there is a priority, even though the spot prices may be much, much higher, but CGD are being given. So these actions will tell you that government has a strong vision for a continual development of the CGD sector. Now, it has gone to 51%. Certain measures which government took. Now, what measures they are taking? That the LPG plant operators, and who are also the large like GAIL and ONGC, they are actually taking the ATM gas, which was a part of a priority for extraction of LPG, and the LPG gas was being given to us. Government view was that since CGD has a first priority, let even that part be currently given benefit to the CGD. That's only rational because they saw that CGD's allocation has come down significantly to 57%, 68%. So that would put a lot of pressure on us at this winter period that we have to bridge the gap with a very high-priced gas. So government had in mind that affordability of end consumers should also be balanced. So I think keeping in mind affordability of end consumers balancing, also seeing that which other areas government could help CGD sector is what is being done. That's the reason the 51% gas has been restored. Now, other industries so far have not been restored. It's only LPG that has been restored, plus the new well gas is being given to us. That's the only current update we have. What we also understand from government is that government is continually working on one, how much more ATM gas could be given to CGD from what all measures could be taken, either industrial allocation or any other allocation. Second, what other help government could extend on supply chain aspect because we also have supply chain cost. I think there is a continuous engagement which is currently in place to make sure that there is a balancing approach on CGD gas, ATM restoration or supply chain cost optimization. Similarly, ensuring that, for example, if new well gas is coming, that also gets allocated to CGD. Thank you, sir, for this clarity. The last one from my side as an investor and analyst, we would be happy to get clarity on a timeline related to ATM allocation changes in the coming months. When can we expect the next ATM allocation changes? If you could shine some light on that. No, as I said, this is the continual process government is looking into it. At the same time, if you see, despite the allocation what we had, let's say from 63 to 51, 51 to 37 during this quarter, also balancing the end prices by us, we have been able to still produce the financial results which are in front of you. So I think it does both the things. While we are working with the government, we are engaging with the government through the Association of CGD Entity, also working continuously on the government side that we should have more and more ATM gas. The fact is that CGD now has started looking into what all optimization could be done on supply chain aspect, complex aspect. And that's the result today we are giving you. So I think we are also preparing ourselves to see that if tomorrow this allocation is not restored, how are we going to be working on a sustainable basis, making sure we balance the interest of end consumer and also produce the good financials and operational results from the point of view of investor and other stakeholders. And that's what is being done. If you see these results, if you read more in detail, it will give you how the LTT has actually been able to cope up with this challenge. Thanks a lot, sir, and it was really helpful. Thank you. Thank you. Thank you. The next question is from the line of Varatharajan from Antique Stock Broking. Please go ahead. Thanks for the opportunity, sir. Once again regarding the subsidy path. So when the allocation went down to 51,000, it has been back to 51,000. New well gas definitely is dropping the cost of that subsidy by 51,000. This is the right side of the observation. You feel like you don't have to think external. It is less than 67 to 51, whatever the factor is, that is the new well gas. Is that the right understanding? Good afternoon, Rahul Bhatia this side. Actually, the ATM has been restored to 51%. The new well gas that we are getting is in addition to the 51%. So that percentage will be more like 15%-16% of the new well gas? The New Well Gas currently in the last quarter was roughly about 7%-8% of our requirement, of our overall requirement. Okay. And currently broadly with. Go ahead, go ahead. Incrementally, like I think you said, it was also of the case of that. So with the latest order of oil ministry, we were looking at the quarterly review of the availability of ATM gas. Is it fair to understand the next tranche of change whatever happens? We should expect something in the quarter cycle if it's the right way of looking at it. Yeah. So the mechanism which has been established by the government is that the government looks at the calendar quarter demand for the CGD segment and looks at the availability of ATM gas and then does an allocation after every quarter. So for a quarter, for example, they will review the October, November, December demand. And based on that, they will be reviewing it from the 16th of February. Likewise, they will look at the demand for January, February, March, and that revised allocation will come into play from the 16th of February. So there's a 45-day gap after every calendar quarter when the ATM reallocation is done. Understood, sir. So let me make a question later on the current run rate of subsidy that you have exactly in the account. But my understanding is that you want to say 70%-80% of new well gas and the remaining anyway, whatever we get third quarter to fill the gap. Yeah. As Mr. Manglani had mentioned a few minutes back, you are aware that as of the 13th of January, 2020, I'm forgetting now, HPHT gas was also afforded top priority to the CGD segment. So just to give you an idea about currently about 40% of our volumes are ATM and another about, as you rightly said, about 8%-9% is new well gas and another 25% is HPHT gas. The new well gas is now being awarded on a proportionate basis just the way ATM gas is allotted or is there any other mechanism? That's right. Fair enough. That was very useful. Thank you sir. Thank you. Next question is from the line of Sabri Hazarika from Emkay Global Financial Services. Please go ahead. Yeah. Good afternoon and congratulations on a good number considering the challenging situation. So I just wanted to get it. You mentioned that right now the CNG, I mean, in Q3, the CNG sourcing mix was 57% was ATM, 8% was new well gas, and the residual is what you mentioned. I couldn't get it. It's another. Yeah. That's HPHT ceiling gas, which comes from the KG Basin. Yeah. As you would be aware, the volumes which are coming from there of the ceiling gas, even in that, the government has afforded top priority to the CGD priority segment of CNG and PNG domestic. So all the auctions and bids which are done by ONGC and the RIL-BP combined, in those bids, the first priority of allocation is given to CGD. So ATG has been bidding very aggressively for those ceiling gas volumes, and about 25% of our entire portfolio today is HPHT ceiling gas. 25% of CNG or 25% of the new well gas? 25% of our entire portfolio. Okay. So in CNG, how much it would be? Any? Yeah. So to give you an idea of our entire portfolio, 40% would be about ATM, about 7%-8% would be NWG, another 25% would be HPHT. This is total ATGL volumes, right? One to eight volumes. That's right. Okay. Fair enough. And the remaining 28% would be in LNG mix. That's correct. That's RLNG. Right. And this new well gas, do you expect it to increase or do you think it will remain? You expect this new well gas to innovate like overall production remains the same or probably it's declining only? We expect the new well gas to go up because for all these fields, the producers now would be very encouraged that they are getting a little premium through ATM gas. They will be encouraged to explore more and to ensure that these volumes would go up very significantly moving forward. Right. You mentioned about the reviews. So the review will take place every month, right? So it takes place once a quarter. Once a quarter, which is a little bit lag, right? That's correct. So if it happens on the 16th of April or 1st of April, whatsoever, that means the allocation period is 45 days lag, right? So it would be like December to February or something of that sort, is that right? The allocation which will be done from the 16th of May will dictate the supply and demand volumes of the January to March quarter. Okay. So it will be expanded on 16th of May, not this quarter, right? 16th of February, Sabri, because October, December, your evaluation will happen on 16th of February as 45 days post the quarter. So 45 days post every quarter. Okay. So February is the timeline. I mean, I thought 16th of January was the 16th quarter. So next will be February 1st, then it will be May, and likewise, it will continue from here on. Yeah. 16th of January was a sort of out-of-sequence increase because the government saw that the CGD segment had been very significantly affected. And as Mr. Manglani said, that the government keeps looking at ways to stabilize and to optimize ATM gas to the CGD segment. So when they saw the very significant impact that had happened to the CGD segment and to the CNG consumers, then they sort of huddled together and they ensured that ONGC and GAIL had to surrender some of the gas which was going into their LPG plants. And they did an out-of-turn increased allocation on the 16th of January. Got it. Got it, sir. And regarding your margin for SPM, so this quarter has been around INR 10. You said it was around INR 12-INR 13 for this quarter. So these transportation gas costs are rising at the same time we've got nodal certification and all. But what could be the revised guidance now that you have more clarity on this whole thing? So Sabri, I think as you are aware, I think we are still seeing some of these developments on how ATM match-up is happening, like we saw on the 16th of January. We are awaiting to see now in the normal course of allocations that will happen on mid-February. So one is on the ATM side. Second, ATGL's desire has always been to keep pushing volumes. Even if you see the current quarter, our volumes have grown by about close to 15% on a YOY basis and 6% on the immediate preceding quarter. So we've always wanted to balance volume whilst what is the bid up or SCM being made. So that's the balance that we continue to do so. And we would expect, therefore, our margins to remain in a similar sort of range at this juncture. So this INR 10-INR 12, is that correct? That's correct. See, the only thing when you all go through these results in more detail, you will find that now we have been also speaking to you in several previous quarters, and you must be also doing analysis of the ATGL result. We have focused significantly on the digitalization automation processes, the IoT-based applications which we have been implemented. Now almost 98% volumes are getting fully IoT-based. So we are able to see the loss in accounted gases, etc., significantly coming down because it is a real-time monitoring. So you will see optics on these digitalization programs giving us a benefit and increasingly so in the future going forward. So that also would have to some extent positive impact on our EBITDA per SCM. Operational expenditure is now the real focus for us. While Rahul is working very hard along with his team to see how he builds the gas portfolio, what should he do now? He has to redraw his whole strategy now again on the gas sourcing kind of a thing. He has to rebuild his portfolio to make sure that when ATM gas allocation remains a bit of a challenging the way it is now, and the new well gas also comes at a premium, HPHT comes at a premium. Spot definitely is a very high premium. So how he is able to manage the end customer interest, I think he is doing a lot of good work. The operation teams are doing good work on operational excellence, and entire our digitalization program is helping us. So I think we are working holistically to see how do we balance the interest of all stakeholders. Got it, sir. Thank you for this. And just last question, what has been your nine-month project? Yeah. I mean, बाकी लोगों का सारा क्वेश्चन शायद पूछ ही लिया है। हमको क्या मजा आता है, 15-20 लोग तो पूछते हैं, पर आप पूरा ही क्वेश्चन पूछते थे। I think in terms of our nine-month capex, if I were to look at it in terms of the capex incurred plus the commitments that we are making as far as our newer rounds are concerned, our cash spend will be close to about INR 650-odd crore, including the newer businesses. While if I were to look at it in terms of further commitment on the pure CGD, that would be close to about an additional INR 1,000 crore. Roughly, you should see our year ending in terms of from a CapEx perspective to a number closer towards INR 900-1,000 crore. ₹900-1,000 crore or $10 million? Yes. Thank you so much for all the questions. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Nitin Tiwari from PhillipCapital. Please go ahead. Hi sir, good evening. Thank you for the opportunity to ask a few questions from our end. So if you can give us the classification of PNG and CNG revenue and also a breakdown of CNG sales in MMSCM, between domestic and the CNG consumers? So I think on an overall annualized basis, our volume has been close to 2.8 for the quarter. In that 2.8 for the quarter, close to about 32%-33% is PNG, while 66%-67% is CNG. So that's the breakup between CNG and PNG as far as the quarter volumes are concerned. No, I'm not sorry. I'm not talking about the volume. I'm talking about the revenue between CNG and PNG. And please again break down and explain this growth between CNG and PNG. And same for the previous quarter as well, please. Yes. Sure. So in terms of sales volume, if I were to give you the composition in terms of sales, CNG will constitute close to about 66%, while 34% is on the CNG side. Similarly, if I were to look at the immediate preceding quarter, the immediate preceding quarter will have a similar number of close to about 67% and 33%. So 66%-67% is the CNG sales, while 34%-33% is the PNG sales for Q3 and then Q2. So this is the general revenue you're talking about? That's correct. What is the breakup of PNG sales among the subsegments of domestic and industrial commercial segments? Sorry, can you repeat the question? The break-up of PNG sales volume in domestic and industrial and commercial segments? Yeah. In terms of the PNG breakup of the 34% that I mentioned to you, the absolute number at ATGL, close to about 23% is industrial, 8% is domestic, and about 2% is commercial. So that's all amounting to close to 34%. So, sorry, you have to say that you gave it as not these are the percentages in volume concerned? That's correct. Yeah. So you mentioned 8% is domestic and 2% is commercial. 2% in yeah, yeah. That's correct. 2% in commercial. Industrial was, sorry, how much? 23, 23. 23. This is the percentage of overall volume. This is not of PNG. Absolutely. Yeah. And just to understand that, while you've already given out the gas sourcing right now, I just wanted to understand two things related to that. One is, isn't HPHT gas allocated out? So I just want to understand that what is the quantity which is available on IGX because gas from national fuel regulation or other HPHT sources are typically allocated out, right? Not a lot of that quantity is available on IGX. Is that understanding correct? So Rahul decides. Yeah. At this point of time, roughly about 2-2.25 million cubic meters of gas is being brought by the RIL, which we combine on the IGX every month, and this would sort of this is happening since January. May continue till March or something till the time that they come out with a bid with an auction and sell these on a long-term basis. Okay, so 2-2.5 million CNG is available on IGX right now is what you see. Yeah. Great, and in terms of LNG revenue, how is the LNG sourcing divided between contracted long-term LNG and spot purchases for you? We generally don't keep our open position for spot purchases more than about 5%-7%. But since APM went down very significantly in recent months, our open position right now would be about 10%. All right. So let's start. So So these contracts are Brent and what is the index they are linked to? Brent and Henry Hub. Any representation can you give us of the percentages between Brent and Henry Hub? Okay. I told you that overall, the numbers that we got, we sell about 100,000 MMBtu per day. And out of which about 50% is APM and NWG, and about 25% is HPHT gas. Out of the balance, 25%, you would have about 17%-18% of Henry Hub contracts and about 6%-7% of Brent contracts. And the balance would be the open position. Understood. So I'll ask for the question in the report. That's my question. I mean, that answers most of my queries. Thank you so much for your participation. Thank you. Thank you. Participants who wish to ask a question may press star and one at this time. As there are no further questions from the participants, I now hand the call to the Senior Management for their closing comments. Thank you. Thank you all the participants and managers of ATGL for taking the time out. And anyone wish to get further updates on ATGL, please connect to us. Thank you. Thank you. Thanks, everybody. On behalf of ATGL, this concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you. Thank you.