ATGL Q2 FY27 Earnings Call: Revenue Jumps 34% But PAT Lags, Targets 80-90 New CNG Stations

ATGL held its Q2 FY27 earnings call on October 22, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Volume-Led Growth, But Profitability Lags Revenue

• Q2 FY27 revenue rose 34% YoY to Rs.2,102 crore — volumes grew 12% YoY to 315 MMSCM, EBITDA rose 12% YoY to Rs.340 crore, and PAT grew just 3% YoY to Rs.167 crore.
• H1 FY27 volumes grew 13% to 618 MMSCM — EBITDA rose 3% to Rs.621 crore and revenue grew 31% to Rs.3,999 crore.
• CNG volumes led with +17% YoY to 223 MMSCM — PNG volumes grew 3% YoY to 92 MMSCM; new-geographical-area volume mix improved to 41% from 35% in Q2 FY26.
• Natural gas costs rose 43% YoY in Q2 FY27 — driven by higher Brent and RNG prices, currency depreciation, domestic gas availability shifts, and withdrawal of pooled gas support; management offset this via diversified sourcing, flexible procurement, and calibrated pricing.
• Sustainability score reached 75 out of 100 — per the NSE sustainability and SES score; management stated ATGL is pivoting from a traditional city gas distribution company into an integrated energy platform.

Tightening APM, Rising Spot Exposure, HTHP Volatility

• APM share stood at 25% in Q2 FY27 — management indicated a slight reduction in APM allocation, with New Well gas and HTHP gas fluctuating from time to time.
• Close to 40% of the non-APM portfolio is on spot basis — of the 75% non-APM sourcing in Q2 FY27; around 40% of the referenced 70% is linked to markers such as Henry Hub and Brent-linked contracts, including spot volumes.
• Government is supporting the CGD sector by offering HTHP gas — following removal of the pool gas mechanism, the government calibrates and allocates these volumes across all CGD sectors based on HTHP production cycles.
• HTHP volumes vary month-to-month and fortnight-to-fortnight — management cited variation in the range of ~50% to ~1%, a material supply-planning headwind.
• Cumulative CNG price hikes of Rs.11-12/kg in Ahmedabad across June-August — management did not confirm restoration of pre-war margin levels, saying it follows a calibrated approach and does not pass on the entire cost to customers.
• A long-term gas supply contract has helped manage costs — management continues to explore gas supply scenarios vis-à-vis its long-term growth projections (period unspecified).

CNG Stations, Households and Industrial Build-Out

• 16 new CNG stations added in Q2 FY27 — network at 623; 39,574 new PNG household connections (base 11.81 lakh); steel pipeline network at 16,305 inch-km.
• H1 FY27 build-out: 732 inch-km of steel network, 21 CNG stations, 77,817 new households — ~900 industrial & commercial customers added (base 10,864), ~1.4x the additions in all of FY26.
• Management added 68 CNG stations in FY 2025-2026 — targeting 80-90 new CNG stations in FY 2026-2027, with investment and procurement execution described as on track; no quarter-wise breakup provided for Q3-Q4 FY 2026-2027.
• FY 2027-2028 CNG additions under discussion — management said similar, possibly more aggressive, additions are at discussion stage for FY 2027-2028, to be calibrated across volume-driven, virgin and conventional GAs; final decision not yet taken.
• ~70 CNG stations at an advanced stage of construction as of Q2 FY27 — equipment procurement started and pipeline laying underway across all GAs.
• No Rs. crore capex disclosed for FY 2026-2027 or FY 2027-2028 — despite a direct analyst request; management said it is aggressively focused on expansion capex and looking at similar infrastructure expansion growth in FY 2027-2028.
• With JV partner IOAGPL, the pan-India network reaches 1,185 CNG stations — 14.31 lakh PNG household connections, 12,925 industrial & commercial connections, and 29,156 inch-km of pipeline.

EBITDA Margin Gap Flagged; Recovery Framed as Temporary

• EBITDA margin at ~16.2% in Q2 FY27 versus historical levels above 23% — analyst flagged the gap against 3-4 years prior, with revenue growth of 34% but EBITDA growth of only 12% and PAT growth of just 3%.
• CEO attributed margin pressure to temporary factors — the West Asia crisis and volatility in Brent and other markers; the company is entering long-term contracts where it makes sense and calibrating OPEX/CAPEX to maintain or achieve higher EBITDA margins; no specific recovery timeline was provided.
• CNG volumes growing at ~17-18% in FY 2026-2027 — close to industry growth of ~20%; industrial and other volumes growing in double digits, which management framed as within company control.

B2B Charging Focus; Deliberate CBG Pace

• 5,513 EV charging points installed across 26 states/UTs and 225 cities — 63 MW installed capacity (H1 FY27 update); ~4,809 operational as of Q2 FY27 per company presentations.
• Analyst cited the Chairman's 2023 target of 75,000 EV charging stations by 2030 — management did not quantify current utilization levels or the incremental capex required to reach the target.
• B2B charging tied to group captive customers — CEO said a key industry concern is EV charger utilization; ATGL has tied up Adani Cement, Adani Ports, and Adani Logistics to build truck-charging infrastructure on specific roads, which management said will deliver higher revenue and utilization than the B2C segment.
• Barsana (Uttar Pradesh) CBG plant produces ~5-6 tons currently — being expanded to double output within the next 5-6 months (≈Q4 FY 2026-2027 to Q1 FY 2027-2028), with investment committed and technology selection finalized; technical partner at the site is Thermax.
• Feedstock at Barsana is a mix of cow dung and paddy straw — options under evaluation include energy plantation, municipal waste, paddy straw, agricultural waste and chicken litter; management said land availability, feedstock availability and product offtake (biomanure and biogas) must all "tick" in parallel for an investment decision to make sense.
• Management is deliberately taking "slightly lower steps" on CBG growth — additional projects in the pipeline, but the vertical will advance only once there is visibility and full confidence on technology and feedstock; no CBG economics or return metrics disclosed despite the analyst's request.

2 Lakh Connection Target for FY27; Milestones Withheld

• Management is aiming to close more than 2 lakh domestic PNG connections in FY 2026-2027 — describing it as a sizable number; ~40,000 domestic connections were added in Q2 FY27.
• Each new connection expected to add close to 0.4-0.5 SCMD — average per-connection gas volume is around 0.4 SCMD.
• Management did not commit to specific connection milestones beyond its current-year target — despite the analyst's request for 12-24 month milestones linking expansion to incremental EBITDA growth (period unspecified).
• Domestic penetration is the basic priority across operations — PNG household development in key areas as well as new GAs, per management.
• No forward-looking guidance or targets were provided in the opening or closing commentary segments — the call concluded after no further participant questions.