1. At a Glance
If “gaslighting” were a business model, Indraprastha Gas Ltd (IGL) would be the undisputed market leader — but sadly, this quarter’s gas didn’t light up the earnings. The ₹29,772 crore market cap City Gas Distribution (CGD) giant reported Q2FY26 revenue of ₹4,608 crore, up 14.6% YoY, yet profit slipped to ₹372 crore, down ~15% YoY. The culprit? Rising input costs and reduced domestic gas allocation — the kind of double whammy that even Hanuman couldn’t leap over.
The company, a JV between GAIL and BPCL with the Delhi government owning 5%, still enjoys a divine moat in the National Capital Region, supplying CNG and PNG to millions. With a P/E of 18.6, ROCE of 20.8%, and debt of just ₹102 crore, IGL remains a model of financial discipline — though its growth engine feels a bit choked lately.
As the Bhagavad Gita reminds us: “Karmanye vadhikaraste, ma phaleshu kadachana” — do your work without obsession for results. For IGL, that means keep laying pipelines and expanding stations… even if profit margins keep evaporating like PNG in Delhi’s smog.
2. Introduction – The Gas That Built a City
Indraprastha Gas isn’t just selling natural gas — it’s practically running Delhi’s respiratory system. Born in 1998 as a love child of GAIL and BPCL, IGL was tasked with bringing clean fuel to the NCR. Fast forward to FY25-26, and it’s running 819 CNG stations, 25.6 lakh PNG connections, and supplying to ~10,000 industrial and commercial users across NCR and nearby cities.
From CNG autos in Connaught Place to PNG tandoors in Gurgaon, IGL’s reach extends like DTC buses during rush hour — everywhere and occasionally late. But while demand for clean energy is rising, the company’s margins have been on a crash diet.
Q2FY26 results showed that while sales were up 8.8% QoQ, profit was down 15%, proving once again that revenue growth without cost control is like eating rajma without rice — deeply unsatisfying.
Still, this gas major isn’t running out of breath. It’s venturing into hydrogen blending, EV charging, and even gas meter manufacturing — diversifying faster than Delhi drivers switching lanes. But will these bets keep the profit flame burning, or will policy swings and allocation cuts blow it out?
3. Business Model – WTF Do They Even Do?
IGL’s business model is as clear as your windshield after Diwali rain: they distribute natural gas to homes, vehicles, industries, and restaurants.
The model has three big cylinders:
1. CNG (Compressed Natural Gas):
This is the main course, accounting for 75% of revenue. It fuels 17 lakh+ vehicles daily with a compression capacity of 97 lakh kg per day. Every time a Delhi auto honks “po-po”, there’s an IGL meter ticking in the background.
2. PNG (Piped Natural Gas):
The “gas pipeline” dream every middle-class Delhiite boasts about after buying
