Gujarat Gas Ltd: Steady Growth Amidst Market Challenges in Q3 2025

Gujarat Gas Ltd (BOM:539336), a leading city gas distribution (CGD) company in India, reported its Q3 2025 earnings on February 7, 2025, highlighting steady growth amidst market challenges. The company's financial performance, while facing headwinds, demonstrates its resilience and commitment to growth.



Gujarat Gas Ltd reported a flat net profit of ₹221 crore in Q3 FY25, with revenue rising 5.7% YoY to ₹4,152.9 crore. Despite the modest growth in revenue, the company's EBITDA margins contracted to 9.2% from 10.2% a year earlier, reflecting higher costs. However, Gujarat Gas Ltd's growth strategy aligns well with the Indian government's push for cleaner energy sources and reduced carbon emissions.

The company's focus on expanding its customer base and infrastructure, particularly in the area of Compressed Natural Gas (CNG) stations, supports the government's initiative to promote the use of natural gas as a cleaner fuel. Gujarat Gas Ltd's CNG volumes grew by 12% YoY to 3.12 mmscmd in Q3 FY25, reflecting the broader demand trends for natural gas in India. This growth is driven by increasing adoption of CNG as a cleaner fuel, growing demand from industrial and commercial sectors, expansion of CGD networks, and government initiatives.



Gujarat Gas Ltd's growth strategy also involves expanding its industrial volumes and aggressively pushing its FDODO (Farm-to-Doorstep Delivery of Organic Produce) model to accelerate future growth. The company increased industrial volumes by 1,72,000 scmd during Q3 FY25 and added over 38,200 new domestic customers and commissioned five new CNG stations. These initiatives support the government's push for cleaner energy in the industrial and agricultural sectors.

In conclusion, Gujarat Gas Ltd's Q3 2025 earnings call highlights the company's steady growth amidst market challenges. The company's focus on expanding its customer base and infrastructure, particularly in the area of CNG stations, aligns well with the Indian government's push for cleaner energy sources and reduced carbon emissions. Despite the modest growth in revenue and contraction in EBITDA margins, Gujarat Gas Ltd's growth strategy demonstrates its resilience and commitment to growth. As the company continues to invest in its infrastructure and expand its customer base, it is well-positioned to capitalize on the growing demand for natural gas in India.