We submit herewith the disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 - Disclosure of Material Events.
Awaiting price reaction for this filing.
Mahanagar Gas Limited (MGL) has been informed that its allocation of domestically produced APM natural gas — the cheaper, government-priority fuel for City Gas Distribution companies — has been cut by approximately 18% effective April 16, 2025, compared to the previous fortnight. The reduced APM volume is being replaced with New Well/Well Intervention gas (NWG), which is costlier than APM gas. The company has stated that this substitution will have an adverse impact on its profitability, as the higher-cost replacement gas will squeeze margins on PNG (domestic) and CNG (transport) segments. MGL said it is exploring measures to mitigate the impact on earnings.
Negative for shareholders in the near term — higher input costs from the switch to NWG gas will pressure margins on the company's core PNG and CNG businesses, potentially affecting quarterly earnings. Stock may see a negative reaction, though MGL's mitigation efforts and partial pass-through to consumers could limit the damage.