Indraprastha Gas sees steep profit drop on high costs and price protection

Indraprastha Gas Ltd reported a 93 percent drop in its second-quarter net profit due to high input gas costs and its choice to protect consumers from global price changes. Net profit fell to 24.38 crore rupees for the quarter compared to the same period last year. Sales volumes grew 8 percent to 10.06 million metric standard cubic metres per day. Compressed natural gas sales went up 9 percent while piped natural gas sales rose by 8 percent. Gross sales turnover increased 35.4 percent to 5,999.13 crore rupees over the same period.

Context

City gas distributors buy natural gas from suppliers and sell it to households and vehicle owners. When global gas prices go up, companies often absorb the extra cost to protect everyday buyers from sudden price shocks, which can severely lower their quarterly profits.