Gas demand has sharply recovered: GAIL
NEW DELHI: Natural gas demand has sharply risen and is now barely 5-7% lower than the pre-Covid levels, GAIL Chairman Manoj Jain has said.
GAIL's gas sales had dropped by 30% in the early days of the lockdown as factories stopped operating and vehicles went off the roads. But the demand is fast returning.
Gas demand from key industrial sectors such as power and fertilizer has returned to pre-covid level while the demand for compressed natural gas, used in vehicles, has risen to about half the normal, Jain said. GAIL’s petrochemical plant at Pata is also operating at full capacity after staying shut for 2-3 weeks during the lockdown.
GAIL has launched certain cost-optimisation measures, which it expects to help maintain its profitability this year, Jain said.
GAIL has reported a 10% year-on-year rise in profit to Rs 6,621 crore in 2019-20 mainly on the gains from switching to a new corporate tax regime.
The turnover for the year declined 4% on year to Rs 71,730 crore. In the Jan-March quarter, the profit rose 169% on year to Rs 3,018 crore due to tax gains. The quarterly revenue, however, fell 7% to Rs 18,268 crore mainly due to a decline in income from natural gas marketing.
The company isn’t planning to cut its planned capital spending for the year but fears that some projects may take longer to complete due to the pandemic, resulting in rollover of some expenditures to the next year, Jain said.
GAIL’s shares closed up 2% on Wednesday when the benchmark sensex ended 1.58% down.
The Economic Times 25-06-2020