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Gail's Net Profit Slumps 77% Due To Russia-Ukraine War: CMD
The standalone net profit plunged 77.5 per cent year-on-year to Rs 603 crore in the fourth quarter (Q4) against the net profit of Rs 2,683 crore in the year-ago period
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The Gas Authority of India (GAIL) on Thursday posted a 77.4 per cent slump year-on-year in standalone net profit for the fourth quarter due to the Ukraine-Russia War. The standalone net profit plunged 77.5 per cent year-on-year to Rs 603 crore in the fourth quarter (Q4) against the net profit of Rs 2,683 crore in the year-ago period.
Talking to ANI, Sandeep Kumar Gupta, Chairman and Managing Director, Gail, said that gas prices became very high due to the Russia-Ukraine war which impacted the company's profit, despite its highest-ever annual revenue of Rs 1,44,302 crore, which was up 57 per cent, for FY23.
Gupta said, "The petrochemical segment was affected, gas prices were not viable and because of it, we had to keep our plant shut and also keep it running at lower levels for a substantial period of the year because we were to service our customers which were tied up at long-term prices."
He added, "However, we had to procure high-priced gas to supply to our customers and in transmission because some APM (administered price mechanism) allocation, which was there was taken away, so we had to consume the high-priced natural gas for our internal consumption, too."
Now with the cooling of prices now, he said he hoped that all these adverse factors will not be there in the next fiscal and the company should come back to very robust numbers in the ongoing fiscal year.
Talking about the current status of the supply-demand ration, the Gail CMD said, "There was a supply disruption starting from May 22 after the Ukraine-Russia war last year and while this was a portfolio contract and the supplier should have supplied by cargo sourcing from other geographies if it was not possible from a particular territory, but then they did not supply."
He also expressed hope, "However, it's good news that now the supplies have resumed from March this year."
He said for the last two months, the company was getting the full allocation as per the contract, and hopefully that it would continue. "So, this is a big sort of reassurance on the supply front. And definitely, there is no cut as far as our downstream customers are concerned nowadays," the GAIL CMD said.
Talking along the lines of Kirit Parikh Committee recommendation, the CMD said, "This is a very significant positive development that the government accepted the recommendation. This will definitely help."
In fact, he said, "We have seen that with the implementation of this recommendation from the first of this year, there was a big drop in CNG (compressed natural gas) and PNG (piped natural gas) and definitely with such softening of prices, the consumption which was not happening in the last year especially will now come to normal levels."
He said this would add more new customers, too. "So, definitely this will be the biggest step in taking natural gas to higher levels of consumption," he added.
Gupta said, "We are having gas supplies from Qatar, the United States, and Russia from Australia. So, we have a very diverse portfolio of supplies. We are now scouting for new volumes and wherever those new volumes are there. We are talking to all such companies or countries. The new volumes are coming from primarily the Middle East and North America. These are the geographies where the discussions are going on."
Talking about the hydrogen plant, Gupta said, "Our first green hydrogen electrolyzer is coming up at Vijaipur, Madhya Pradesh, this will be a capacity of 4.3 tonnes per day and this will be commissioned this year itself." (ANI)