GAIL Q3 net rises 31% on share sale

Written by PTI | New Delhi | Updated: Jan 30 2014, 10:22am hrs
State-owned gas utility GAIL India has reported a 31% jump in December quarter net profit, thanks mainly to the exemption from paying fuel subsidy.

Net profit in the October-December period rose to R1,679 crore, or R13.24 per share, from R1,285 crore, or R10.13 a share, chairman and MD BC Tripathi told reporters.

Apart from not having to pay any fuel subsidy, the company sold 60 million of the 210 million shares in China Gas.

"We bought the shares at $1.15 per share and sold at $8.2. After paying capital gains tax, the impact of stake sale on profit after tax (net profit) is R345 crore," he said. "But for this gain, the PAT would have increased by 9%."

GAIL still holds 3% stake in China Gas, he said.

Sales soared 28% to R15,981 crore in October-December 2013 from R12,474 crore in the third quarter of the last fiscal.

Tripathi said the government had decided to cap GAIL's contribution towards subsidy at R1,400 crore, which was already paid in first six months of the current fiscal.

Upstream producers such as ONGC and GAIL meet a part of the revenue that fuel retailers lose on selling diesel, domestic LPG and kerosene. GAIL is not picking any further subsidy bill in the third and fourth quarters.

Tripathi said revenue rose on account of an increase in gas prices GAIL sold 8.6 million standard cubic metres per day of imported LNG in the third quarter as against 3.2 mmscmd a year ago.

There was a shortfall of 12 mmscmd in gas transmitted by GAIL through its pipeline due to lower volumes available from RILs KG-D6 fields and BG Group-operated Panna/Mukta and Tapti fields, he said.