Mumbai CNG Crisis: Mahanagar Gas Says 40% Supply Hit From Pipeline Damage — Margin Guidance Stays Unchanged
After a major gas pipeline was damaged supply of CNG was disrupted in Mumbai, affecting thousands of autorickshaws, taxis, and other CNG-run vehicles. Mahanagar Gas Ltd. has clarified that the recent gas supply disruption in the region will be normalised by Tuesday afternoon.
While MGL was able to offset part of the shortfall through alternative supply sources, it still witnessed a 40% volume loss for one day. The company, which supplies around 4 mmscmd of gas in these regions, said nearly 50% of this comes from the station that was affected.
Ashu Shinghal, MD Mahanagar Gas in an interview with NDTV Profit emphasised that this was a one-off event and confirmed that the overall impact for the quarter would be “negligible”.
Margins Steady Despite Higher Gas Costs
After a margin squeeze in second quarter due to elevated gas costs that were not fully passed on, the company said gas costs have increased further in the third quarter. Despite this, MGL expects the third quarter margins to remain in the stable range of Rs 8.5–9.5 per scm.
On why the company has refrained from taking price hikes recently—despite routinely doing so in the past without any volume impact—Shinghal said the priority is to maintain a competitive delta with petrol and diesel prices while keeping margins at “normalised levels.”
The focus, they added, is on earning reasonable margins and supporting volume growth rather than aggressively defending margin per unit.
Volume Guidance Stays at 10%
MGL achieved its guided 10% volume growth in the first half of the financial year. While the second half typically sees stronger volumes, the company is sticking to its 10% annual guidance, stating it prefers not to “over-commit and underperform.”
Shinghal also added that Vehicle additions remained healthy, with CNG additions in November 2025 staying in the same range as October’s figure of around 10,000 vehicles. On a full-year basis, MGL expects 1 lakh new CNG vehicles to be added.
However, the company recently trimmed its unit Ebitda guidance by around Rs 0.5 per scm but does not foresee any further reduction. While LNG prices often rise during winter months, Shinghal said it will decide whether to pass on any future increase to consumers depending on market conditions.
Engagement with Bus Operators, Fleet Opportunities
With Mumbai’s BEST shifting towards EV adoption and consequently lowering its CNG usage, MGL acknowledged a decline in contribution from the fleet. Shinghal remains in active discussions with BEST and is also engaging with other bus fleet operators. MSRTC’s contribution to volumes remains limited for now he added.
MGL has also recognised the slower penetration of CNG in light and medium goods vehicles in Mumbai compared to Delhi. The company has launched two initiatives aimed at boosting CV customer acquisition.
Regarding its joint effort with IBC to set up a battery cell manufacturing plant, Shinghal confirmed that land acquisition is complete and other project activities are currently being worked out.
