Gujarat Gas Expects 8–10% Volume Growth In FY25
The company expects a higher volume growth contribution from the CNG segment, which is expected to grow by 15-20% in fiscal 2025.
Gujarat Gas Ltd. expects volume growth of 8–10% year-on-year to 10 million metric standard cubic metres per day in fiscal 2025, mainly coming from the compressed natural gas segment.
The city gas distributor has guided for an additional 0.8 to 1 million metric standard cubic metres per day of volume for fiscal, according to its earnings conference call held on Feb. 15.
The company also expects growth in industrial volume, particularly in areas like Ankleshwar and Dahej, as well as from the commercial sector.
Compressed Natural Gas Segment
The company expects CNG volume to grow by 15-20% on a year-on-year basis, the management said during the conference call.
The management remained positive on the growth potential within the CNG segment, while highlighting how CNG had the highest margins in Q3 FY24, indicating a positive trend in the market.
FDODO Scheme
Gujarat Gas also remained optimistic about the full dealer-operated and dealer-owned, or FDODO, introduced by the firm. Through the scheme, which aims to encourage local entrepreneurs to invest in and operate compressed natural gas stations within the company's network, the company will also significantly reduce its capital expenditure requirements.
The company anticipates the scheme to drive growth in the short term with expected outcomes and results within the next one to two years. Under the scheme, the company plans to operationalise over 200 CNG stations within a two-year period, covering the entire state of Gujarat.
Capex
The company estimates a capex of around Rs 900–1,000 crore over the next 2–3 years. Management also stated that due to the reduction in capex on CNG stations due to the FDODO scheme, future capex will mainly be allocated for upgrades and maintenance.