“In line with this policy, the Company was allocated APM natural gas for Domestic PNG and CNG (Transport) based on APM gas availability. Allocation of APM to the Company has been reduced by ~18%, effective April 16, 2025, compared to the previous fortnight APM allocation,” Mahanagar Gas said in a regulatory filing.
The disclosure aligns with the policy guidelines issued by the Ministry of Petroleum and Natural Gas on August 10, 2022. As per the policy, APM gas is allocated to city gas distribution (CGD) companies specifically for priority sectors such as domestic piped natural gas (PNG) and compressed natural gas (CNG) used in transport.
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The policy also clarifies that such allocations are limited to the quantity available and supplied through GAIL (India) Ltd. Mahanagar Gas Ltd stated that the reduced APM gas volume has been replaced with New Well/Well Intervention gas (NWG). This switch, however, comes with a cost implication.
The company cautioned that the change is likely to adversely affect profitability, as NWG is typically priced higher than APM gas. Despite the expected impact, MGL said it is exploring various measures to mitigate the effect on its margins.
“Reduction of APM volume has been replaced with New Well/Well Intervention gas (NWG). This will have an adverse impact on the profitability, however, the company is in the process of exploring all measures to mitigate the impact,” it added.
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Shares of Mahanagar Gas Ltd ended at ₹1,314.00, up by ₹36.55, or 2.86%, on the BSE.
