Ladies and gentlemen, good day and welcome to Petronet LNG Limited Q1 FY27 earnings conference call hosted by Dolat Capital Market Private Limited. As a reminder, all participants' lines will be in listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star and zero on your touch-tone phone. Please note that this conference is being recorded. I now hand over the conference to Mr. Yogesh Patil from Dolat Capital. Thank you, and over to you, sir. Thank you, Pari, and good day to everyone. It is my pleasure to welcome all the participants on this call, as well as the Petronet LNG senior management for the first quarter FY 2027 results conference call. With us, we have Mr. Saurav Mitra, Director of Finance and CFO. Mr. Rakesh Chawla, Executive Director, Finance and Accounts. Mr. Gyanendra Kumar Sharma, CGM and President, Marketing. Mr. Vivek Mittal, CGM and President, Marketing. Mr. Debabrata Satpathy, CGM and President, Vice President, Finance and Accounts. Mr. Vikash Maheshwari, General [audio distortion] Ladies and gentlemen, the line for Yogesh sir has been disconnected. Please stay connected. Meanwhile I have joined them. Thank you for waiting patiently. The line for Yogesh sir has been joined. Please proceed with your remarks, sir. I request Mr. Saurav Mitra to deliver his opening remarks. Over to you, sir. At the outset, let me briefly take you through our financial and operating performance for the first quarter of FY 2026 and 2027. Overall, I would say it has been a strong start to the year. While volumes were somewhat lower, we have delivered a healthy financial performance supported by commercial and operational efficiencies. On a standalone basis, profit before tax stood at INR 1,514 crore compared to INR 1,136 crore in the corresponding quarter, registering a growth of 33%. Profit after tax was INR 1,133 crore, again a growth of 33% compared to INR 851 crore in the corresponding quarter. On a consolidated basis too, the performance has been quite encouraging. We reported PBT of INR 1,491 crore and PAT of INR 1,137 crore, our highest ever PBT and PAT for any first quarter. Coming to the operational performance, Dahej, our flagship terminal, processed 192 TBTU of LNG during the quarter, compared to 207 TBTU in the corresponding quarter last year and 201 TBTU in the previous quarter. At the company level, the overall LNG volume processed was 207 TBTU, compared to 220 TBTU in the corresponding quarter and 219 TBTU in the previous quarter. As far as capacity utilization is concerned, there is an important point to keep in perspective. For the current quarter, the nameplate capacity of Dahej increased from 17.5 MMTPA to 22.5 MMTPA. So the utilization numbers now reflect a significantly larger capacity base. On this expanded capacity, Dahej utilization stood at 66%, compared to 92% in the corresponding quarter and 90% in the previous quarter. Overall company capacity utilization in the current quarter was 58%, compared to 76% in both the corresponding and previous quarters. If I were to sum up the quarter, the key takeaway for us is the resilience of the business. Despite the lower volumes, we have achieved 33% year-on-year growth in both standalone PBT and PAT. This reflects our continued focus on commercial and operational efficiency and our ability to deliver a strong financial performance across different market conditions. We remain focused on carrying this momentum forward as we progress through the year. With that, I will conclude my opening remarks. We will now be happy to take your questions. Thank you very much. We will now begin with 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 handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Probal Sen from ICICI Securities. Please proceed with your questions. Thank you, and very good evening, sir. Just had a couple of questions. Firstly, you mentioned about the financial performance being strong despite lower volumes. What has also been interesting is that the mix of volumes has changed quite dramatically, with term volumes declining very sharply and third-party regas volumes making the difference. Just wanted to understand, has that same pattern been seen in Q2 so far as well? Should we basically assume that this will be the mix moving forward, at least till the Gulf conflict is resolved in any shape or manner? That was my first question. Okay. Yes, the pattern and trend continues as it was in the Q1 of this financial year, till so far. However, we expect the issues at the Gulf to resolve soon and the volumes from our long-term contract with Qatar should start immediately or as soon as possible. That's our topmost in the wish list. Got it, sir. The second question was, sir, with respect to apparent margins, in terms of how we have performed despite lower volumes. Just wanted to understand where the margin improvement has come from, whether there is any inventory gain impact for the quarter, or is it basically that marketing margins or even the small amount of spot volumes that we did have actually helped offset the lower volumes? What's your thoughts on that? Okay. Probal, you have actually answered both the points. There is trading gains and also there is inventory gains. Okay. Inventory gains are at INR 193 crore and trading gains are at INR 301 crore. That's exactly because of the higher margin and also higher inventory valuation. But, sir, will some of that then normalize in Q2? Is that a fair way to look at it, that this amount or this kind of margin trend may not sustain for the rest of the year? You see, to answer your question, the trend has been that whenever there is a disparity between the long-term and the spot prices, the spot prices are too high, and there is a big gap between the long-term prices and the spot prices, and the overall throughput goes down because of that. Then what happens is these trading margins kick in. Because the spot price is being high, we have some opportunities in the market to gain from the spot trading. So this can be considered, looking at the last five, six years trend, this can be considered as the business model of the company. Understood, sir. If I can squeeze in one last question. Any update you want to share on the last bit of connectivity for the Kochi terminal, and any update you can share on the Petchem plant. That will be very helpful. Thanks. Okay. I will first start with the Petchem plant. The project is on schedule. As far as the connectivity with the pipeline with our Kochi terminal is concerned, as far as the latest information that we have, by the end of this quarter, it should be mechanically completed. That is the best information that we have as on date. Understood, sir. Thank you so much for your time. I will come back if I have more questions. All the best. Thank you. Ladies and gentlemen, if anyone who wishes to ask a question, may press star and one now. Thank you. The next question is from the line of Simran Kumari from Narnolia Financial Services. Please proceed with your question. Hi, sir. Good evening. My question is related to capacity utilization. Can we get the separate capacity utilization for both Dahej as well as Kochi terminal for this quarter? How would you project this utilization to trend over the remaining quarters? That is my first question. Vivek, you can. Yeah. So the capacity utilization for Dahej was 65.62%, but please do take note that this is for the expanded capacity, which got expanded on 31st of March 2026. So from 22.5 MMTPA, the capacity utilization is 65.6%, and Kochi was 23.27%. How do you expect the trajectory for the remaining of this fiscal year? You see, all this will depend on the opening of the Strait of Hormuz. Right now, whatever capacity utilization has been told, same kind of trend is right now going on as we have told before. Once the Strait of Hormuz opens, then you see these Qatari volumes and the volumes from that region will be available in the market. So definitely, the capacity. And you can see from the volume numbers that currently also, even if that volume is not available from the Gulf region, still more than two-third of that is being compensated from other parts of the world. So once those volumes are available, definitely the capacity utilization will improve quite a bit. Just to add on to what Saurav Mitra mentioned, that actually in this quarter, April was on the lower side, May, June things picked up. We are actually running at the same rate as it was in May and June. So this means that probably it should be better slightly. Okay. Can we get the CapEx number for FY 2027 as well as FY 2028? CapEx number so far. So far- No, no. Not so far. For fiscal 2027 and 2028. Okay. FY 2027, the CapEx numbers are INR 9,064 crore we have budgeted. Similar kind of numbers should be for FY 2028 as well. Can I squeeze in one last question, which is related to gross margin? Could you just walk us through the key driver behind this improvement, and what level of gross margin is sustainable going forward? That's my last question. Can you repeat the question? Which- Gross margin. What was the reason behind this significant improvement in the gross margin this quarter, and how it will sustain for the remainder of this fiscal? See, that is what I had already answered to Probal's question. The gross margin improvement is because of the trading and inventory gain. In the coming time also, if such kind of situation in the market is there, whereas the spot prices are higher than the long-term prices by quite a few distance, then this kind of trend could be there. The volume mix that we are seeing right now, like the trading has gone down, whereas our tolling volumes have gone up, and more than two-third has been recovered from the tolling volumes only. If this kind of trend continues, then the gross margin will definitely show greater trading gain and inventory gain. Because that is last five years trend we have seen in these kind of situations, that is the business model that fits in. Okay, sir. Thank you so much. Thank you. The next question is from the line of Nitin Tiwari from PhillipCapital. Please proceed with your question. Hi, sir. Good evening. Thanks for the opportunity, sir. Sir, a couple of clarificatory questions. So, in this quarter, the tolling cargoes were brought in to offset our long-term cargoes. Our arrangement for basically the use-or-pay for the previous years has actually been that, if excess cargoes come in, then it will be used for offsetting that use-or-pay. Would this tolling cargo be treated as an offset for use-or-pay? Because this is in excess of what probably one would have expected. It is coming in lieu of the long-term contract. Is that the right understanding? Nitin, you are right partly because, see, firstly, you must understand, it depends on who is bringing those long-term cargoes. If GAIL is bringing, they had no use-or-pay. Then there is no question of offset against GAIL cargo. But yes, for other off-takers, so if they are bringing additional cargoes, there would be some offset. But to clarify that the order of importance is the current year's commitment. After that only they can offset. Current year commitment would basically be considered. The higher number would only be considered after considering long-term plus tolling as current year commitment, is what you are saying? For tolling itself, see, if they are bringing more in the tolling, then the order of importance is first the current year's commitment. They have to adjust that, then only- Okay. -any offset for the past year will be taken. Right, sir. Just drilling down further on this. So, sir, basically, the cargoes we are bringing for tolling, that same cargo will be considered for offsetting use-or-pay, right? Long-term contract is not a part of that arrangement, right? Yes. Your understanding is correct. Long-term contract, as far as the buy and sell is concerned, that is a separate contract where take-or-pay clauses are there, not use-or-pay. Okay. Yes, that's correct. Is this the correct understanding that, if this situation continues, then this tolling cargo which is coming in can retire the use-or-pay much faster than possibly which would otherwise have been possible? Absolutely. Depending on the part you can use of it. That's the only caveat I would add. Understood, sir. Second question is the bookkeeping one, if you can give me the IND-AS impact for this quarter at gross margin depreciation in other subheads. At a gross margin level, positive is INR 14 crore, Forex loss is INR 5 crore, and other expenses level, positive INR 8 crore. Depreciation INR 66 crore, and finance loss INR 48 crore. Understood, sir. Thanks so much, sir. I will get back in the queue. Thank you. Before we take the next question, we would like to remind participants that you may press star and one now. The next question is from the line of Mayank Maheshwari from Morgan Stanley. Please proceed with your question. Hi, sir. Thank you for doing the call. The first question was related to Qatar LNG, more on a more medium-term basis. What are you hearing in terms of the supply cargoes? Obviously, it is a bit of a fluid situation, but considering the force majeure, et cetera, how are you thinking about sourcing these cargoes from elsewhere? As well as what are you hearing from Qatar in general around when can they think about delivering some of these volumes? Firstly, I will answer the second question. We are in constant touch with QatarEnergy, and they are also waiting for things to improve. The Strait of Hormuz, every day there is change of statement at geopolitical level. Nobody has an answer that when the Strait of Hormuz will open. But the moment it opens, Qatar is, as you have seen certain media reports even of yesterday, that Qatar has started production. They are ramping up their production. The measurement they are doing in terms of the heat around the plant. So that level is increasing, which means production is increasing. That was a Bloomberg article yesterday. As soon as the Strait of Hormuz is open, we are hopeful that we will start taking volumes on FOB basis from Qatar. Mayank, your second question was why are we not sourcing from alternate sources? Of course, as you have seen, if we buy and then sell it, there is certain taxation implications. So directly, if off-takers or GAIL, IOCL, BPCL is importing, that becomes more advantageous and more saleable in the market. So we have to be competitive in the market. From that perspective, we have given the capacity to these capacity holders to bring more volumes. FM declaration- Got it. -from Qatar is on a month-on-month basis. So basically every month, depending on the situation, they are declaring. So right now, it's been declared for end of August. Sure. The second question in terms of petrochemicals, was what percentage of your CapEx has been spent on petrochemicals till now? In terms of completion on the physical side, how much have you been able to complete that? Okay. As I have told, we are on track with our petrochemical project. As per the schedule, we have completed about 40%. The CapEx spend would be roughly about what percentage of this? The CapEx, there is always a difference between the CapEx spend and the physical progress. Financial progress is not exactly it will match with the physical progress. That is why I have to give you a proper perspective of the physical progress of the project. I have given you the physical project number. Fair enough. Perfect. Thank you. Thank you. The next question is from the line of Kishan from DAM Capital. Please proceed with your question. Hi, sir. Thanks for taking my question. One question from my end, sir. Sir, at Dahej, we had signed a contract with Deepak Fertilisers, wherein they were expected to bring in additional cargoes. Have those started? I think around 1.5 MMTPA. Have those started? And similarly, at Kochi, ExxonMobil's volumes were expected to increase. Have those volumes also increased? Yes. Both contracts have actually started taking place. We have brought in volumes. Volumes have been brought in by both the parties under both these contracts. Okay. For the quarter, can you quantify how much did Deepak Fertilisers bring in? Was it one cargo, two cargoes, or how much was it? Two cargoes. The contract commenced till May 2026, so until date, we have got two cargoes. Okay. Understood. Also, if I could ask one more question. Any update on the tariff discussions that we've been having with our off-takers or the status quo remains? No. The status quo is there. There is no discussion on tariff revision. Okay. No discussion on tariff revision, but contract renewal, nothing has happened, right? No, we are still in talk, discussion with our off-takers. We still have some time. The new contract with QatarEnergy is going to start in 2028. Almost on a daily basis, we are meeting with our off-takers and finalizing the terms and conditions. Okay. If you're saying that you're meeting regularly, can we expect the closure to happen in a quarter or two then? Yes. Okay. You can expect. That's great. Okay, sir. Thank you. You can expect it to happen in the next two to three quarters. Two to three quarters. That's great, sir. Thank you. Thank you. The next question is from the line of Bineet Banka from Nomura. Please proceed with your question. Hi, sir. Thanks for the opportunity. Firstly, on your new purchase contract with QatarEnergy, which is coming up from 2028. [audio distortion] Your voice is breaking. Sorry, we cannot hear you. The new QatarEnergy from 2028, it is based on DES basis rather than FOB earlier. How does it impact the landed cost of the gas? It's a formula-driven price, which includes the shipping cost. Of course, we cannot disclose the formula. I'm not sure what you're looking at in this picture. The change in landed cost. [audio distortion] Mr. Banka, we are not able to hear you. Can you please rejoin the queue? Okay, sure. Thank you. Thank you. The next question is from the line of Vivekanand from Ambit Capital. Please proceed with your question. Yeah, two questions. Number one is on the capacity that you have freed up in Qatar because volumes are not coming. How much visibility do you have of the off-takers getting volumes, and what is the logical utilization or volume that we should model for the hedge till the time this crisis continues, as far as cargo processing goes? That is question one. The second one is on the trading side. If you can explain this trading business and also the circumstances where you are profitable on your trading contracts, and of course, how to think about it incrementally, that will be great. Thank you. Firstly, let me answer on the visibility question. As you would have seen, Indian gas demand and government has been working on it to make sure that all the sectors get gas in an equitable manner. In context of that, we do see that if the Qatar FM continues, the replacement volume will continue to flow in at our terminal, so we do not see any issue. As we mentioned that FM is a force majeure is being declared on month-on-month basis, so I cannot say that off-takers are now tying up volume for September, October. They are again tying up on month-on-month basis, depending on the requirement and the replacement volume, whatever is required. On the trading part, I think, Vivek. Yeah, on the trading part, as we had explained before, we create efficiencies in the system. Due to that, whenever there is an opportunity, either we serve it on the spot basis from these efficiencies, or whenever there is an opportunity, we bring a spot cargo and also cater to the customer's need without taking any volume or price risk. In this case, as we had explained that when the spot prices say, for example, very high, and the long-term prices are at a different level, and there is a low throughput from the terminal. At that point in time, with a smaller volume of spot trading also, we can protect the bottom line, taking the advantage of the market. This we have seen since last five or six years. This is an established business model now. Okay. Just a couple of follow-ups. When Qatar is declaring a force majeure, you said that the status is that till end of month, they will not supply cargos. Let's say, by when do you find out that, okay, in September you will not get any cargos from Qatar, and then what is the next step? Just if you can walk me through the process so I can understand better how you are able to then talk to your off-takers and then utilize some of the freed-up capacity because Qatar is not sending you cargos. Firstly, we are in constant touch with QatarEnergy team. On a regular basis, we have conversations with them, and typically, they are declaring force majeure at least a week before end of the month. Okay. So it is that dynamic, is it? You get to know a week before the next month starts that, okay, you have free capacity. Yes. Okay. Just to drill further on the trading gains that you make Is that linked to the spare capacity that you currently have because Qatar is not supplying, or is the run rate that you have been mentioning independent of the spare capacity you have in Qatar, or even otherwise? It is independent of that. If you see the spot trading, it is only six TBTUs. So for six TBTUs or 10 TBTUs of something like that of volume, we need not have a spare capacity. Even in the COVID, aftermath of COVID, and during the Russian-Ukraine conflict also, whenever there is such situation in the market was there, with a very low volume, we could generate a higher trading gain. I hope that answers. Okay. Understood. Thank you very much, and have a nice day. Thank you. Participants who wish to ask a question may press star and one now. The next question is from the line of Hardik Solanki from ICICI Securities. Please proceed with your question. Thanks to you both here, sir. Sir, what was the regasification revenue for the quarter? And in actual, how much was the spent volume as well? We could only hear your first question. The regasification revenue is INR 1,214 crore. The rest of the question we could not hear. Could you repeat that? Yeah. So how much till date have you spent towards the CapEx? CapEx is the same picture. See for the year. INR 5,608.79. Are you asking about the CapEx? CapEx in June or cumulative? Sir, talking about CapEx. Okay. For the quarter. For the quarter. CapEx for the quarter is INR 472 crore. INR 470 crore around. Thank you. Thank you. The next question is from the line of Bineet Banka from Nomura. Please proceed with your question. Hi, sir. Sir, for PDH plant, has there any propane contract been signed already? Okay. Propane is a readily available commodity. From that perspective, I think 2027 we will enter to sign the contract. We may have a mix of- Go ahead. The sourcing will basically be mostly coming from the Middle East, right? And Saudi CP pricing. We also have major potential source, so we are exploring all the possible opportunities. For this project, sir, is there any equity IRR that you had given earlier? I think in 2023, the number was 30%. Have you done any recalculation based on current pricing? Bineet, as we had maintained before, we have still to do certain commercial contracts. A couple of contracts we have already done, like the 600 MTPA ethane and LNG. This one with Deepak Phenolics. But then certain other commercial contracts we have to do. So we have to keep these numbers closed to the public for the time being. Sir, what will be the useful life of the plant? If I have to do the calculation for the profitability, what we could assume the useful life for the PDH-PP plant? These kind of projects, generally, people take a 25 years life. Okay. And sir, another question on the third contract from FOB to DES. You are already four LNG. If you have DES contract from Qatar, then what is the use of the LNG carriers? Because I think they are there for 25 years at least. Most of the carriers, once the SPA ends, the carrier also time charter comes to end. Except one. Okay. Okay, sir. Thank you. Thank you. The next question is from the line of T.K. Nigam from an Individual Investor. Please proceed with your question. Hello, sir. Good to talk to you. Can you confirm if my understanding of the business model is correct? As long as that force majeure continues, you have the liberty to trade gas at the spot prices. If that force majeure moves aside and normal business kicks in, then you can again start doing business at the contracted prices. Is my understanding correct? No. Sorry. See, the contracted volumes, they come in and go to our off-takers on back-to-back basis. The trading business is independent of that. It depends on the market opportunity, the price at which we are buying cargos, at which we are able to sell. As Saurav mentioned, out of operational efficiency, we do have some LNG available. So we trade that also. It is a mix of all, but it is nothing to do with certain contracts. Okay. Got it. Thank you, sir. Thank you. The next question is from the line of Nitin Tiwari from PhillipCapital. Please proceed with your question. Hi, sir. Thanks for the opportunity again. Sir, just wanted to understand, what are our tariffs right now at Dahej and Kochi for the current quarter? Dahej is around INR 69 and Kochi is around INR 98. Kochi is INR 98. Great, sir. Secondly, sir, also, I wanted to understand that the vessels that we have on time charter basis. Are we paying the charter rates or that also is under the ambit of force majeure and it's not paid? How does that work? Your understanding is correct, sir. That is also under force majeure. Okay. We are not paying any charter. I would like to clarify. I would like to clarify that all the time charter vessels, we have suspended the operation, not under any force majeure clause, but there are other clauses in the contract, in the time charter agreements, through which we have enabled the suspension. Got it, sir. Great. Thanks for clarification. That is all from my end. Thank you. Before we take the next question, a gentle reminder for all the participants. If you wish to ask a question, please press star and one now. The next question is from the line of Jayesh Shah, an individual investor. Please proceed with your question. Thanks a lot for this opportunity. Just a quick question, sir. I hope I am audible. No, your voice is not clear. Is it better, sir? Yeah, slightly better. Sir, I can just go. Thank you for this opportunity, sir. No, not audible. Assuming things get back to normal. Not audible. Mr. Jayesh, we cannot hear you. Yes, sir. I'll call you back. Thank you. The next question is from the line of T.K. Nigam. T.K. Nigam. An individual investor. Please proceed with your question. Hello, sir. Can you put some light on how much certainty or how much certain is the sourcing of alternative cargoes till the time this Middle East conflict continues? The sourcing is actually being done under the tolling contract, service contract by our customer. As per trend, whatever we are missing from the Middle East, actually more than two-thirds is being brought by these customers. We hope that this trend will continue, and we are seeing that this trend is continuing right now. Okay, sir. That answers my question. Thank you, sir. Thank you. Ladies and gentlemen, that was the last question from the participant. I would now like to hand over the conference to management for their closing comments. Thank you, and over to you, sir. Okay. Thank you. Thank you so much for joining us once again, and we will continue to keep in touch through such initiatives. Thank you. Thank you. Thank you, everyone. Thank you. On behalf of Dolat Capital Market Private Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.