Adani Total Gas Ltd

NSE:ATGL

Earnings Call Analysis

Adani Total Gas Q1 FY25 Earnings: Strong Growth and Expansions

Adani Total Gas reported a 9% year-on-year increase in revenue to INR 1,237 crores for Q1 FY25. EBITDA rose by 21% to INR 308 crores, with profit after tax up by 20% to INR 177 crores. The company expanded its infrastructure, adding 12 new CNG stations and 38,165 homes to its PNG network. Additionally, Adani Total Gas launched 606 new EV charging points and targets 10 LNG stations by year-end. The company also upgraded its ICRA credit rating to AA stable, which will support future CapEx plans.

Strong Financial Performance

Adani Total Gas Limited (ATGL) reported strong financial results for the first quarter of FY '25. The revenue from operations stood at INR 1,237 crores, which marks a 9% increase from the same period last year. This uptick in revenue was driven by a 17% volume increase year-on-year, with CNG volume growing by 20% and PNG by 10%. The company's efficient gas sourcing portfolio contributed significantly to these gains, helping achieve an EBITDA of INR 308 crores, representing a 21% increase over Q1 FY '24. Profit before tax rose by 19% to INR 237 crores, while profit after tax increased by 20%, reaching INR 177 crores .

Credit Rating Upgrade

One notable achievement this quarter was ATGL's credit rating upgrade from ICRA AA minus to ICRA AA stable. This improved credit rating is expected to aid in funding the company's capital expenditure requirements and reflects the strength of ATGL's balance sheet .

Expansion of Infrastructure

ATGL continued to expand its infrastructure, adding 12 new CNG stations, bringing the total to 559. The company also increased its steel pipeline network to 12,244 inch-kilometers. On the residential front, ATGL connected 38,165 new homes to PNG, totaling over 8.58 lakh homes. Additionally, 211 new industrial and commercial consumers were added, increasing the total to 8,542. These expansions underscore ATGL’s commitment to growing its footprint across India .

E-Mobility and New Ventures

Branching out into other energy sectors, ATGL has formed a 100% subsidiary focused on e-mobility. By the end of June 2024, the company had established 1,212 EV charging points across 15 states, with 606 of these added in the latest quarter. ATGL aims to expand its network further, with 750 additional charging points under construction. On the biomethane front, the Barsana plant has ramped up its production capabilities, exploring new feedstocks and increasing organic fertilizer production. Additionally, ATGL is actively developing LNG solutions for long-haul transport and mining, with a target of commissioning 10 LNG stations by the end of FY '25 .

Challenges and Margins

Despite an overall positive performance, ATGL faced some pressure on margins due to an increase in gas purchase costs, leading to a marginal decline in gross spread by INR 1 per SCM. Nevertheless, the company mitigates these challenges through a diverse gas sourcing portfolio, including APM and HPHT gases .

Future Outlook

Looking ahead, ATGL remains optimistic about its growth prospects. The expansion into newer geographies and the development of EV and biomethane markets are expected to contribute significantly to future revenues. Management remains committed to leveraging its upgraded credit rating to support ongoing and future expansions, fostering sustainable growth .

Earnings Call Transcript 2025-Q1

[Operator]

Ladies and gentlemen, good day, and welcome to the Adani Total Gas Limited Q1 FY '25 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Suresh Manglani ED and CEO. Thank you, and over to you, sir.

[Suresh Manglani, executive]

Thank you. Good afternoon, everyone. Let me extend a very hearty welcome to all our investors, analysts, funds for taking out their time and participating in today's call on Q1 FY '25 results of Adani Total gas.

First, let me give you the infrastructure highlights on all our businesses. During the quarter, ATGL have built 12 additional CNG stations and network has increased now to 559 stations. Out of these 559 CNG stations, we have now increased our presence on DODO/CODO, company-owned, dealer-operated and dealer-owned dealer-operated to [ 110 ] CNG stations. Our Steel Pipeline, which is our backbone infrastructure has now increased to 12,244, inch-kilometer. This is the measurement where we do it quarter-on-quarter. This will enable us to provide the entire ecosystem of PNG/CNG in all of our geographical areas. This is a backbone infrastructure.

On the home PNG side, ATGL have further added 38,165 new homes on PNG. In the period -- during the period April to June '24. And now we are serving over 8.58 lakh homes on the PNG. Similarly, for industrial and commercial consumers, which are the businesses we connect on PNG supply, we added 211 new industry and commercial consumer to PNG and the total tally has now increased to 8,542 consumers. This covers diversified industries and different format of commercial consumers. With these, our pan-India footprint along with our JV joint-venture company, which is Indian Oil Adani Gas Private Limited.

In CNG station has now reached to 927 stations. And together, on the home PNG side, we have now crossed 1 million domestic homes milestone, serving to total over 10.2 lakh homes along with IOAGPL and 9446, basically 8542 stand-alone and 9446 industrial and commercial consumer along with the JV.

Let me give you an update on our other businesses, which we are developing simultaneously along with the CNG business. The first business is E-Mobility. You are all aware that we have formed a special SPV, a 100% subsidiary of ATGL. As on 30th June, total 1,212 EV charging points have been set up across 15 states. And this quarter, April to June, we had set up 606 additional new charging points, which are part of 1,212. While I'm speaking to you at this point of a time, 750-plus EV charging points are under various stages of construction, and we hope to see them going live in the coming quarters, coming weeks. Once we add this 1,212 plus 740 charging stations which are under construction and many more other acquisitions, our EV network will spread across 23 states and 217 cities in India.

The next business, which for which again we have formed a special SPV, a 100% subsidiary of ATGL is the Biomass business. You're all aware that as we have announced last time also that we have commissioned a Phase 1 of our largest Biomass plant situated in Barsana which is near Mathura, that the base fee stock for that is the co-located cow shelter, 60,000 cows are there. So the base feedstock is cow dung, and I'm happy to inform you all that the commissioning work has completed and now we are adding new diversified feedstock, pedestal as well as placement. And we'll keep looking forward some more diversified feedstock, which we could add, so that we bring the more and more methane contents coming out.

So CBG production will go up as well as this will also help us to increase the organic fertilizer production from the Barsana plant. Another business, which is being developed as a part of ATGL is the LNG for transport and mining. The business objective is to provide LNG in the liquid form as a fuel for long-haul vehicles like buses and trucks. As well as also explore the opportunity for decarbonizing the mines in India providing LNG for various equipments and transport and mining.

So we would -- we are very happy that very soon, we would have our first LNG station commissioned in Tamil Nadu, a district called [ Tiruppur ] where we have CGD license. So we are commissioning the first LNG station. And soon, we will be seeing more and more LNG stations coming up. Our target is to commission 10 LNG station in this financial year. And this will -- ATGL will help in developing the ecosystem along with other players so that LNG for transport or long haul vehicles wears the traction in the country, as a part of energy transition journey of India.

Now let me share with you the operational and financial numbers what ATGL has achieved during first quarter. During the first quarter, our volume increased by 17% on year-on-year basis. Our CNG volume has increased by 20% to 153 MMSCM in Q1 FY '25 as compared to last year Q1 FY '24. And our PNG volume has grown by 10% to 77 MMSCM. This PNG growth is largely due to recovery in PNG Industry segment and new consumers addition on homes and commercial side.

On the financial front, for the quarter, first April to June FY '25, following the highlight. Revenue from operations stood at INR 1,237 crores, which is up by 9% year-on-year basis. With the increase in the volume as well as efficient gas sourcing portfolio has helped us to achieve our EBITDA of INR 308 crores, which is 21% higher as compared to the Q1 FY '24.

Profit before tax and profit after tax have increased to INR 237 crores in the profit before tax reported and INR 177 crore profit after tax is what June 30, 2024. Now the PBT has increased by 19%, and the PAT has increased by 20% as compared to the quarter 1 of FY '24. Another good news, which I wanted to share with you all is that during this quarter, Adani Total Gas credit rating also got upgraded from ICRA AA minus to ICRA AA stable. This will help ATGL leverage this upgraded credit rating as well as healthy balance sheet to fund its CapEx requirement based on the drawn capital management plan. Lastly, I would like to acknowledge and be thankful to all our stakeholders, analysts, fund houses, consumers dealers, our media friends, suppliers, partners and all our employees, the team ATGL for doing a lot of hard work commit -- with all the commitments and for all the stakeholders for providing trust and continued support. Thank you.

[Operator]

[Operator Instructions]

The first question is from the line of Kirtan Mehta from BOB Capital Markets.

[Kirtan Mehta, analyst]

Congratulations on very strong numbers.

[Operator]

Sorry to interrupt you, sir. May I request you to please use your handset.

[Kirtan Mehta, analyst]

I was saying that congratulations on the very strong set of numbers. I had a couple of questions. First one on the margin that we have earned during the quarter. So we see that the gross spread has marginally declined this quarter by INR 1 per SCM or so. And primarily because of, I think, the increase in the gas purchase cost wanted to understand the underlying dynamics in terms of how was the availability for the priority sectors, the APM gas availability. And were we able to capitalize on the lower spot LNG opportunity during the year.

[Suresh Manglani, executive]

Okay. Anything -- any other question? Kirtan?

[Kirtan Mehta, analyst]

The second question was about you referred to the target plan for the LNG, first LNG station and the target of 10 LNG station. I also wanted to understand in terms of what is the annual throughput that's potential to be achieved in the LNG plant, what kind of economics we are seeing relative to the CNG station? Some color on that?

[Suresh Manglani, executive]

So anything else you have in your mind? Or should I respond to you?

[Kirtan Mehta, analyst]

Would be the -- your new business area is something interesting where I think we do not fully understand the revenue or the profit generating ability. So color on Biomass as well as EV point, if at all, you can throw light on them as well, that would be really great.

[Suresh Manglani, executive]

So thank you, first of all. I think you are the regular participant on our calls, and we really appreciate your regular tracking of not only our results, but I'm sure you're keeping track of other oil and gas participants, including CGDs. So if there's any observation on that also, we'll be very happy to listen offline or online with you also.

I will certainly start with your LNG as well as new business, and then I'll pass on the call to our gas sourcing and business development head, Rahul to give you a response to -- on the gas sourcing and the dynamics under done in quota there.

So let me just give you very briefly about LNG part. Now this is chicken and egg. We need to understand that who takes the lead. Should we see first consumers get the LNG vehicles and we start working on infrastructure development or we take a lead as the -- as a company which has a full faith that this is going to be a new source of fuel coming in the country. And we have seen the energy transition report, which has been made public by the Energy Transition Committee, which has clearly laid out the road map, of course, is yet to be fully notified, maybe inform or modified form, but it gives a direction to us. And we also see what's happening in the -- globally.

So our view is that while EV could also be alternate source future hydrogen will be resource for the HSD long-haul vehicles. But our view is that for the next many years actually and immediately, the LNG is the most suitable available fuel provided we bring certain advocacies in place as well as certain economies in place. So while we are working on that front, not only we, but almost all the stakeholders are working on that front. We believe that we must show the demonstration of our commitment in terms of setting up a few LNG stations, which is 10 is not a very large number. The plan is much larger for us to allow this momentum to pick up people to have a confidence in LNG fuel for transport vehicles.

We see almost 450 or around 500 vehicles LNG now moving in the country. And we see all the OEMs, Tata Motors, Ashok Leyland, Green Line and others taking interest in manufacturing the LNG trucks, new trucks. So our view is that while we could always see the margins, et cetera, this is a new food, which is coming up in this country, not only we, but all the stakeholders should come forward and develop this ecosystem. India needs it. You saw the budget you're seeing talking about energy transition road map, and we believe this would be for us 1 of the component along with other energy transmission components.

So our current view is that we should participate in this ecosystem development. There is a good case of economics. Today, people are looking paying the HSD as their fuel. Our view is that if you do a good strategy on this long-term LNG or the normal LNG which we procure, as well as there is a government support comes forward in terms of taxation, in terms of some support on gas allocation for small volume to duly boost to the initial momentum of the LNG usage for the fuel. I think this will develop a very long-term point of view, this is going to be a good fuel. And this will provide us a big opportunity as an early mover.

So my sense would be that we should look at from that strategic direction prospective today. We have just started rolling out and we are also thinking that not only we'll do the CODO which we are doing today in Tiruppur, but we are also seeing interest from people coming for a DODO stations as well. So we will be doing a mix of this 2. And we are also contacting a large number of corporates and transporters, and we see very good interest from them. There are certain asks in terms of economics, pricing, et cetera, which we as well as other stakeholders are working.

So we are hopeful that this traction will come in the next few quarters. I will also give you some color on the new businesses. The LNG for transport also is a new business, which I gave you some color. On the first, let me take a Biomass, I think you are seeing how India is speaking about biofuel or the world is speaking. Our view is that this is a big opportunity for the country. I think this is almost a necessity that a sustainable fuels have to be explored. And is a sustainable June.

Actually, it helps us to also dispose of the risk, which otherwise becoming obtained, whether it's a municipal solid waste or agri waste. So in our view, there's a big opportunity if we are able to do the things right, if we are able to bring the technology right, which we believe we will be able to do being the JV of 2 very large conglomerate all the resources to our command financials are to our command, I think we're able to do a good job there. So we have started with Barsana. We supported one CSR plant in Varanasi, which is functioning quite well. Barsana soon we will be able to see a full streamlining happening, and then we are going for many more FIDs. So in our view, CBG holds a very good potential in terms of volume as well as on the profitability part. You have seen CBG blending has been made mandatory now 1% to 5%. You have seen a lot of government policies, which are financial assistance coming up in terms of connecting CBG plant with a pipeline with INR 900 crores plus assistance coming from first 100 plant. You have seen PM -- this marketing support INR 115 per ton coming for Organic Fertilizer. We are seeing financial assistance from MNRE, from some state government.

I think whole sort of a machinery is working to make it successful. Now we've our role to play to make this successful and make this as a big potential for this country. We are quite keen to develop this as another business, taking the early opportunities rather than feeling a problem about CBD to the CGD, we feel this is a complementary strength of ATGL. On the -- and the numbers are quite big, actually. If you see government has published 15 MTPA, actually, the actual potential government has said in its own paper 64 MTPA. And even if it becomes 5 MTPA, it is equivalent to 1 LNG terminal. So I think there's a big potential for us, country generating huge waste, whether agri, whether industrial waste, municipal waste, shoes waste, I think we need to do something on this side, and we are -- we believe we will be able to do our bit on the CBG side.

On EV, you are seeing an entire country talking about e-mobility, EV, whether it is 2-wheeler, 4-wheeler or even for heavy vehicles. So we believe this is another opportunity we are seeing direction coming from government, or direction coming from various authorities that state governments as well. So we think this is an early opportunity as well as part of a nation building exercise. So we have formed a separate SPV. We see a big numbers coming up in future because, we had a vision of 30-30, which means 30% of new vehicle which has been sold by 2030 should be EV. It could go 1 or 2 years here and there. But maybe instead of 2030, maybe '32, '33 will be able to achieve, which is a good number, very large numbers of EV coming up. We are seeing model after model, low-end vehicle or high-end vehicles are coming up on EV.

The new business segment, which is getting developed for us on the EV side is 2-wheelers as well, which is a very big market. Maybe mostly, they will charge at home, but there will be a top-up coming up or in the offices, garages, malls, garages, I think, where we are setting up. So again, in our view, you will see these are too early periods for us. We have just started 12, 12 charges, grow the number in large, utilization has to grow. It is again chicken and egg. We have a large number of B2B operations. So if we do things right, I think it will again add a good potential on our revenue side as well as the bottom line side.

To my mind, I think as the progressive management and the JV of these 2 promoters, I think it is always important for us to keep ourselves open to seize this emerging opportunity, which are coming, and that's what we are working on that direction. I don't know whether anybody wants to add anything from here in my room, Parag or Rahul or anybody. But this is otherwise our view on the new business which you have. I will pass on to Rahul, who is dealing with the gas sourcing and BD. To give you the flavor on the INR 1 SCM cost as well as underline dynamics. Rahul?

[Rahul Bhatia, executive]

Thank you so much. Rahul Bhatia [indiscernible] . Yes, there has been a slight impact on our margins because there was a reduction of about 2% in the APM allocation vis-a-vis the previous quarters. But having said that, we have a very diversified portfolio, plus, as you would know, as per the MoPNG Notification of the 13th of January 2023, the CGE also, like ATM has the first right on all the HPHT gas, which is coming primarily out of the KG basin by the Reliance, BP combined, et cetera.

So we have a very significant amount of HPHT gas in our portfolio to share with you of our overall portfolio, about 50% is APM, 30% is the HPHT filling gas and about 20% is RLNG. So therefore, we have a very, very significant amount of HPHT. This also feeds coming on the market on the IGS month-on-month, and we go and whatever volumes we need, we bid for it and we ensure that we get THE very attractively price ceiling Gas. So therefore, if there is any reduction in the ATM allocation, we are able to fairly mitigate that with HPHT. Also, we are not so worried about the allocation reduction because that is something that the government keeps trying to ensure that CGD gets a very good benefit of continued APM allocation.

Just to share with you, post-COVID the allocation has gone down very significantly. And after that, the government made it possible for it to go above 90%, and this happened about a year back. So therefore, whenever there is a change in allocation, then there are serious discussions with ONGC, with all Oil India with GAIL, et cetera, to ensure that the allocation levels are well normalized and broadband. So based on that, we feel confident that the allocation is something -- there are a temporary blip. But on the large run, we see that the allocation is good enough for us to focus on our markets and grow our markets very significantly.

[Suresh Manglani, executive]

Thank you, Rahul. I hope this satisfy you with our response, Kirtanji?

Thank you. Do you have any other questions? Otherwise, we'll be another participant.

[Kirtan Mehta, analyst]

Biomass, if I can have a follow-up. Basically, just wanted to understand would the sort of the cost of CBG gas production would be cheaper than typically the APM gas? Or does it leave some sort of liability funding to make it sort of useful in the sector?

[Suresh Manglani, executive]

We always say [Foreign Language] We keep asking more. But if you see from the point of view of other perspective, we get subsidy from MNRE some states are giving subsidy with some cap like UP gives you cap on maybe in INR 20 crore maximum. Odisha doesn't have any cap. Then we have a urea INR 1500 per ton incentive coming up there. So I think we need to see from -- and plus, we need to -- I know it ask them the urea side. How do we actually develop urea as a B2B or B2C side? How big is the business we are going to develop ourselves.

So there are various aspects to this business. If you want to see the production cost versus APM, it may not directly match because it's not a CBG plant alone, it actually the fertilizer plant. If you see -- you produce almost 5 to 6 times of CBG is the fertilizer. Now how do you sell it? What kind of product mix you develop it, do you develop TROM or FOM. All those are the issues which we are today dealing with and to see how do we maximize. So while the CBG cost would be definitely higher than what is APM Gas. But should we see a long direct match of APM with the CBG price. Answer would be no because answer will be to see the integrated approach. The by product, which they call fertilizer in our view it is the main product because of the shares, the output which comes out. So on an integrated basis, if we do things right, and we get good support on and going forward, blending is coming, which will also get a good demand.

We need to also see today fossil to fossil fail, I think we keep hearing some institutions are a bit tougher vary on the credit giving certificate. But in our view, this will qualify for a green certification. So there will be a carbon credit coming up on the pedestal a good number -- good quality will come on the municipal solid waste Otherwise it generates a lot of methane. So I think how do we package it overall is going to be a good business from our perspective. And from our view, not only the business, but I think it's very important for us, as I say, a domestic company to make sure that we support this conversion of waste to the gold waste to the wealth, which we call it. So in our perspective, I think is a long-term business, sustainable business, sustainable fuel is coming.

Sometime in the future, you will see there will be a demand of a sustainable fuel and we would be the beneficiary of early mover. That's what I would say.

[Operator]

[Operator Instructions] The next question is from the line of Nitin Tiwari from Philip Capital.

[Nitin Tiwari, analyst]

My question was related to your operating expenditures. So I was just looking at the trend, I'm talking about the quarterly trend over the past few quarters. So, there is a general uptrend in operating cost per unit that we see. We saw any particular reasons. Would it be right to understand that as your operations spread in more and more towns, Therefore, given that we are sort of front ending the infra. Therefore, our operating cost at the moment is going up on a per unit basis? And how should we look at this number going forward? That is one. And secondly, let me, sir, continuing on the gas sourcing front, so while like you indicated that 50% is APM and 30% is HPHT. So of the 20% that we are sourcing as RLNG, can you have some understanding in terms of how much of that would be spot and how much would be coming from term contracts. Those are my 2 questions, sir.

[Suresh Manglani, executive]

Thank you, Nitin. I'll ask Parag who's our CFO, to give you an OpEx and the Rahul to own the gas sourcing head who is the BD head.

[Parag Parikh, executive]

Thank you, Nitin. I think as far as the OpEx question is concerned, if you actually go from a trend perspective, you were at an annualized OpEx of about INR 6.04 per SCM for last year. The first year is slightly short at about INR 5.96. So actually, if you see the quarter results, there has been a minor improvement as far as OpEx is concerned. Having said that, when you look at it from a trend perspective, our continued growing CapEx is coming in newer geographies. And as we build the ecosystem in a newer geographies, we are actually trying to create that awareness into the newer geographies by transporting gas through vehicles and [indiscernible] This brings in a slightly additional element of OpEx.

However, it being temporary in nature. So this is 1 of the prime reasons that when you were seeing any newer geography in the initial stages of development, you will see slightly which will come down once the pipeline network has been built. On the same hand, there are obvious continuous efforts of seeing innovative ways of keeping our check on the OpEx and as I guided, if you go by the annualized OpEx of last year, it is actually slightly shorter than that. If you go by the immediate preceding quarter, in fact, there is a significant improvement. But from a broader trend perspective of per SCM we try to keep it in check, absolute numbers will keep going up as operations start building further and this initial temporary cost of transportation of gas.

I hope that answers your question, Nitin?

[Nitin Tiwari, analyst]

Yes, that clarifies it. The reason I asked is because when I was looking at the annualized number for, say, FY '22, it was at INR 4.84 and then the same number for FY '23 was INR 5.56. And then when we move to FY '24, it was almost INR 6. So it really pointed out, I was also thinking in the same direction that because you are spending to your network, so there is some front ending of operation which is happening. And of course, as we pointed out that like operation to cast is often costly until the pipeline and activity is established.

So that explains it. So then on at...

[Parag Parikh, executive]

I think the trend is absolutely analyzing in the numbers that you are reading out are bang on. So there if you see from a 3-, 4-year period, there is an increase in OpEx of about INR 1 to INR 1.20 primary basis newer geographies.

Yes. Over to the second question, I'm handing it over to Rahul to respond to your second query. Rahul?

[Rahul Bhatia, executive]

So when I mentioned 30%, that's about 26,000 MMBtu. And these are all sort of long-term contracts that we've got from about 3, 4 or 5 years for the HPHT gas. But what we do is we keep ourselves open to the tune of about 5% to 7% per year to take advantage of any arbitrage opportunities that may come up month to month. So in case we get attractive HPHT gas price, then as I mentioned, you've got 20% RLNG contract where we've negotiated very attractive take-or-pay levels from our point of view. So in case we are able to get and bid and successfully bring for those HPHT. Then we push back our RLNG volumes in order to take that HPHT and lower the cost of our overall portfolio for the month. So that's what we try to do.

I hope I'm clear.

[Nitin Tiwari, analyst]

Yes, yes. So basically, when you mentioned 26,000 MMBtu, that's your HPHT contract or your RLNG contract?

[Rahul Bhatia, executive]

That's HPHT.

[Nitin Tiwari, analyst]

That's HPHT. Yes. And RLNG, you mentioned is all -- there is most -- I mean you only take like a spot-spot gas when there is an opportunity to take spot gas in terms of favorable pricing. That's what I understand.

[Unknown Executive]

That's right. Because we've got lacks of customers, and we can't keep ourselves open very significantly because that has got to downside. Number one, we can't have a situation that gas becomes very expensive, all a sudden because of higher demand for some [indiscernible] on events, and our customers don't like price stability. So we therefore calibrate ourselves in such way that we see that our openness in terms of the flexibility of our gas contracts. And therefore, if arbitrage opportunities are possible then we push back on the most expensive test of our portfolio to buy -- to take advantage and capitalize on those arbitrage opportunities.

[Nitin Tiwari, analyst]

Right. So the term suppliers are like you are sourcing your own gas or we are sourcing it from GSPC, et cetera.

[Unknown Executive]

You mean RLNG.

[Nitin Tiwari, analyst]

Yes, RLNG sir.

[Unknown Executive]

Yes, primarily the RLNG that we have currently is from gas. It's GAIL Henry Hub.

[Nitin Tiwari, analyst]

GAIL HH. That's very helpful. Lastly, sir, just a bookkeeping question. If you can just break up the PNG volume in terms of domestic, industrial and commercial uptake for the quarter.

[Parag Parikh, executive]

Sure. Sure, Nitin. So I think if you go by the current quarter, close to about 2/3, 66 odd percent is actually coming from CNG and the 34% is coming from PNG. Within the PNG, close to 70% is industrial, about 22% to 23% is domestic and the balance is commercial.

[Operator]

The next question is from the line of Arya Patel from Emkay Global.

[Arya Patel, analyst]

Congratulation on a good set of numbers. So my question was regarding the Jalandhar deal that has been approved by PNGRB . So I just want to understand when will the GA starts adding to the numbers of ATGL as well as what is the potential of the GA? And also if you can guide us on or give a view on how will be meeting the requirements.

[Suresh Manglani, executive]

So Arya Patel, right? You said.

[Arya Patel, analyst]

Yes. .

[Suresh Manglani, executive]

Yes. Thanks for participating and asking very pertinent question because this was the highlight of this quarter that we bought new GA, the transfer of authorization from previous entity to Adani Total Gas. One of the good feature of Jalandhar is now you see the geography area is as very large 4,5 districts encompassing large rural areas et cetera. Jalandhar a city with us, like in Ahmedabad is city, Mumbai is a city or Surat is a city. So that's a very good feature that you'll have concentrated demand pockets. And we are seeing how intensification of population and businesses are happening within the concentrated city. So our view is that Jalandhar will offer us a good volume potential in terms of domestic because city has a large number of houses. Similarly, Jalandhar is known for a large commercial establishments, Punjab, we all know that commercial establishments, whether in terms of Gurdwara restaurants, hotels, are very high in numbers.

So that also will offer a good volume. I think the another feature of Jalandhar is also it offers us a good industrial volume. So and CNG, of course, is an ecosystem because there are neighboring areas, which have already been working on the CNG. So to that extent, while we will put in our sense in developing ecosystem and doing a lot of branding of CNG and working on some marketing intervention for a Jalandhar residents. But our view is that there is a lot of awareness about CNG because we went and visited that.

So from a wholesome perspective, I think Jalandhar offers good volume being a concentrated demand pocket. When are we going to be coming to Jalandhar, I will hand over to Mr. R.B Singh. Who's our project head and also PMO head. He will give you some sort of color on that.

[R. B. Singh, executive]

Thank you Arya we are going to -- you will hear this news within 1.5 months when we are going to commission at least 3 to 4 CNG stations, and we will start distancing CNGs from Jalandhar. We have also started watching on different fronts. Mainly on frontline steel pipeline where we have started detail engineering responses are there and we are also going ahead with the finalization of a [indiscernible] and you will find a surprise progress in this geographical area because in this area, we have everything [indiscernible] is available. We have a choice also -- we have GAIL take off we have GSPL tipoff. When we start CNG ecosystem is already there in the outer where things have started working. So we are extracting from Day 1 itself, we have a good CNG volume from there. So this is all about this because we are just 1 month and we have started working on all fronts as far as development of infra. Thank you very much.

[Suresh Manglani, executive]

Anything Arya we couldn't answer to you?

[Operator]

As there are no further questions, I would now like to hand the conference over to Mr. Priyansh Shah for closing comments.

[Priyansh Shah, executive]

Yes. Thank you, everyone, for participating on the call and also thank the management, Mr. Suresh Manglani and Mr. Parag Parikh and R. B. Singh for joining the call. Thank you, everyone.

[Operator]

On behalf of Adani Total Gas Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.