GAIL net profit falls 6% in Q4 on lower gas marketing margins

State gas utility GAIL (India) Ltd on Tuesday reported a 6 per cent drop in its March quarter net profit on losses in the petrochemical business and lower gas marketing margins.

Net profit of Rs 2,049.03 crore in January-March - the fourth quarter of April 2024 to March 2025 fiscal year - compared with Rs 2,176.97 crore earning a year back and Rs 3,867.38 crore profit in the preceding October-December 2024 quarter, according to the company's stock exchange filing.

GAIL chairman and managing director Sandeep Kumar Gupta said profitability is lower than the preceding quarter as the company had a one-time gain from an arbitration award in Q3.

In the fourth quarter, lower earnings were driven by the company posting lower margins on LPG after the allocation of cheaper domestically produced input gas was cut. Also, the company booked losses in the petrochemical business due to price pressures.

Margins on natural gas marketing - the main business of GAIL - too were lower. Earnings from its natural gas transmission segment, in which GAIL holds a 70 per cent market share in the country, fell 29 per cent.

Gupta said the company had robust physical performance during the quarter and FY25.

"Despite challenges in the global economy, our company had a landmark year, reaching unprecedented financial milestones and achieving the highest-ever EBITDA, profit before tax and profit after tax in GAIL's history," he said.

GAIL reported a 5 per cent rise in revenue from operations at Rs 1.37 lakh crore in FY25 and a record EBITDA of Rs 19,168 crore. Profit before Tax (PBT) in FY25 stood at Rs 14,825 crore as against Rs 11,555 crore in FY24. Profit after Tax (PAT) in FY25 was up 28 per cent at Rs 11,312 crore, he said.

During the year, natural gas transmission volume registered growth of 6 per cent to 127.32 million standard cubic meters per day. Gas marketing volume stood at 101.49 mmscmd in FY25 as against 98.45 mmscmd in FY24. While liquid hydrocarbon (LHC) production was lower at 947,000 tonnes as compared to 996,000 tonnes in the previous year, polymer production increased by 6 per cent to 827,000 tonnes.

During Q4, natural gas transmission volume stood at 120.83 mmscmd in Q4 FY25 as against 125.93 mmscmd in Q3 FY25. Gas marketing volume stood at 106.53 mmscmd as compared to 103.46 mmscmd in the previous quarter, he said.

The Board of Directors has recommended a final dividend of Re 1 per equity share. This is in addition to the interim dividend of Rs 6.50 per equity share.

He further stated that the company incurred a capex of Rs 10,512 crore during FY25.

The board also decided to transfer city gas licenses for six geographical areas (GAs) that GAIL holds for Varanasi, Patna, Ranchi, Jamshedpur, Bhubaneswar and Cuttack to its city gas subsidiary, GAIL Gas Ltd (GGL).

GGL currently owns and operates 16 GAs across India.

"In order to have a single entity for development of GAIL's city gas distribution (CGD) business and for bringing business synergy, efficiency and retail retail-focused business approach, the board has recommended to transfer the six GAs of GAIL to GGL, subject to the approval of the Cabinet," he added.