Hi, good morning, everyone. Welcome to Q1 FY 2026 earnings call of GAIL (India) Limited, hosted by Macquarie. From the management team, we have Mr. Rakesh Kumar Jain, Director of Finance, and other senior executives. Without any further delay, I would like to invite Mr. R. K. Jain for his opening remarks, which will be followed by a Q&A session. Over to you, sir.
Thank you, Mr. Joshi from Macquarie Capital. Dear friends from investors and analyst community, and my colleagues present here, a very good morning and warm welcome to GAIL's earnings call for Q1 Financial Year 2026. At the outset, I seek my apologies for being 8-9 minutes late because of unavoidable circumstances. There was heavy rain in the morning and a lot of waterlogging. My apologies for that. I take pleasure to inform that the Durgapur Kolkata section of Jagdishpur–Haldia–Bokaro–Dhamra Pipeline has been completed and dedicated to the nation by our Honorable Prime Minister on July 18, 2025. With the commissioning of this pipeline, now Bengal Gas will be connected to a natural gas pipeline, and they need not take the molecule through cascade. HPCS 3GA will also get connected. There is a potential of 0.4 MMSCMD for these CGDs on an immediate basis once they start taking.
One another development, on July 23, 2025, GAIL has got PNGRB authorization for capacity expansion of GAIL's Jamnagar–Loni LPG Pipeline. The current capacity, as you know, is 3.25 MMTPA. With the authorization of expansion, this capacity will increase to 6.5 MMTPA. This pipeline will involve a capex of INR 5,000 crore, and it is on this project. As per authorization, we have to complete this project within three years. GAIL's results for quarter ended June 30, 2025, have been declared yesterday. You must have gone through those results. I would briefly touch upon the major highlights for this quarter, post which we may open the session for queries. GAIL's gross turnover stood at INR 34,735 crore in Q1 Financial Year 2026, as against INR 35,602 crore in Q4 Financial Year 2025. You can say, which is almost at same level.
Profit before tax stood at INR 2,533 crore, as against INR 2,701 crore in Q4 Financial Year 2025. This is down by 6%. As you know, mainly we receive dividend incomes in, we do not receive dividend income in Q1, and that was around INR 239 crore in Q4, which is not available. This may be one of the major reasons for this deficit. Further, PBT for Q1 Financial Year 2026 also includes one-off item, that is INR 133 crore on account of differential settlement of unified tariff. This pertains to the previous period, so that is why it is one-off item. The profit after tax for the quarter decreased to INR 1,886 crore, as against INR 2,049 crore in Q4 Financial Year 2025. This is down by 8%, and the reasons are same.
When we compare with the corresponding quarter for last financial year, that is Q1 Financial Year 2025, as compared to Q1 Financial Year 2026, GAIL achieved turnover of INR 34,735 crore, as against INR 33,633 crore, an increase of 3% in PBT. PBT stood at INR 2,533 crore, as against INR 3,642 crore. Profit after tax stood at this quarter this year, INR 1,886 crore, as against INR 2,724 crore in corresponding quarter last year. Now I will touch upon the physical performance of the company during the quarter, as compared to the previous quarter. Gas marketing volume during the quarter stood at 105.45 MMSCMD, as against 106.53 MMSCMD in Q4 Financial Year 2025. Almost a million difference, we can say. It's a flat volume sale. Natural gas transmission is also almost flat as compared to Q4 2025 in Q1 2026.
There was a physical volume transmission of 120.62 MMSCMD as compared to 120.83 MMSCMD in Q4 Financial Year 2025. Our capacity utilization, if you talk on an overall basis, it is 58%. If you talk of integrated pipeline system, which is our major pipeline system, it is 67%. Polymer production is down to 177 TMT in Q1, as against 215 in the previous quarter. This is a normal phenomenon. We basically take our annual turnaround shutdown during Q1, and therefore, this reduction in production is because of that reason only. LST production is almost flat, and it stood at 199 TMT, as against 196 TMT in the previous quarter. LPG transmission was also flat. It was 1,131 TMT, as against 1,132 TMT in the previous quarter. The capacity utilization is 99% during this quarter.
Let me take you to consolidated financials of Q1 Financial Year 2026 as compared to Q4 Financial Year 2025. The consolidated turnover in Q1 Financial Year 2026 stood at INR 35,369 crore, as against INR 36,443 crore. PBT in Q1 Financial Year 2026 stood at INR 3,029 crore, as against INR 3,240 crore in Q4 Financial Year 2025. Profit after tax in Q1 Financial Year 2026 stood at INR 2,369 crore, as against INR 2,492 crore in Q4 Financial Year 2025. I will also take you through the GAIL CGDs. As you know, we have six geographical areas authorized under the GAIL's balance sheet. GAIL is having direct authorization of six GAs and has in first sector of 212 CNG stations and 440,000 DPNG connections.
During the quarter, 2,600 new DPNG connections were added, and physical volume remained at 0.46 MMSCMD during the quarter, with the share of APM gas at 0.169 MMSCMD and RLNG 0.291 MMSCMD. In the next two years, GAIL's target is to add around 85 new CNG stations and around 150,000 new DPNG connections. I will also take you through the performance of Q1 Financial Year 2026 with respect to GAIL Gas Limited. As you know, this is our 100% subsidiary. In Q1 Financial Year 2026, turnover of GAIL Gas stood at INR 2,927 crore, as against INR 3,051 crore in Q4 Financial Year 2025. PBT increased by 1% and stood at INR 146 crore, as against INR 144 crore in Q4 Financial Year 2025. PET was up by 6% and stood at INR 108 crore, as against INR 102 crore in Q4 Financial Year 2025.
Physical volume stood at 7.03 MMSCMD. During Q1 Financial Year 2026, GAIL Gas, along with its JV subsidiaries, has added 23,593 new DPNG connections and three CNG stations. GAIL Gas, with its subsidiaries, has an infrastructure of 1,130,000 DPNG connections and 664 CNG stations. In the next two years, GAIL Gas, along with its JV subsidiaries, targeted to add around 216 new CNG stations and around 260,000 new DPNG connections. I will also take you through the status of ongoing projects which GAIL is taking up. Pipeline projects, majority of pipeline projects which Mumbai–Nagpur–Jharsuguda Pipeline, as you know, this is one of the major pipeline projects we are executing currently. Jagdishpur–Haldia–Bokaro–Dhamra Pipeline, Kochi–Kootanad–Mangalore Pipeline, Shikhanekola–Mangal Pipeline. All these pipelines are scheduled to be completed during the current financial year in a progressive manner.
We have one more authorization of pipeline, Gurdaspur–Jammu Pipeline, and this pipeline is scheduled to be completed in Financial Year 2026-2027. In respect of petrochemical projects. As regards the petrochemical projects, there is PP Pata 60 KTA projects and 1,250 KTA GMP well. These two projects we expect to be commissioned during the current financial year. With respect to PDHPP, that is 500 KTA plant. This has been delayed and is likely to be completed in the next financial year, that is 2026-2027. Now I will also take you through the capex of Q1 Financial Year 2026. During this quarter, a capex of INR 3,176 crore was incurred, out of which INR 536 crore incurred on pipelines, INR 542 crore incurred on petrochemicals. There is an equity contribution of INR 1,458 crore, operational capex, and some other capex, INR 549 crore in CGD, E&P, renewables, etc.
Now I will take you through the short to medium term outlook of GAIL's business. We have been giving you regularly guidance about our marketing margin. This quarter, our marketing margin stood at INR 994 crore. As per our guidance, which we gave during our analyst meet, annual analyst meet in May, we said that during this year, we will earn around INR 4,000-4,500 crore of marketing margin this financial year. As we have already earned INR 994 crore of marketing margin during Q1, we maintain our guidance of INR 4,000-4,500 crore of marketing margin for the financial year 2025-2026. In the gas transmission business, this segment has seen some kind of the unexpected decline in volume. We gave our guidance when we met with you in the analyst meet. We gave a guidance of 138-139 MMSCMD volume. Subsequently, we revised our guidance to 132 MMSCMD.
We also shared the reasons with you for the revision in guidance. Let me just to keep you, give the brief again, what were the reasons. There was a reduction in refinery shippers volume around 3 million. Power sector volume, because of early onset of monsoon, we were free-handing at that point of time. Actually, it is becoming early onset of monsoon. It's a good monsoon this year. There is a reduction on an annual basis of 1.2 MMSCMD in sales and 0.4 MMSCMD of shippers volume, in all, 1.6 MMSCMD in terms of transmission volume. Fertilizer plants, this quarter, we have seen unscheduled shutdown of some of the fertilizer plants. That has also resulted in 1.4 MMSCMD reduction. One of them is KFCL, which is currently not operating. Due to above reasons, we actually revised our guidance. As you saw, our transmission volume in Q1 was 120 plus.
Considering the expected transmission volume in remaining nine months, we want to give you the realistic guidance. We are not optimistic of around 132 revised guidance. We expect this year, on an average basis, we'll end around 127-128 MMSCMD of volume. This is because of the IRJ share, the continue, the frequent tripping of unplanned shutdown of fertilizer. There is a slight reduction in CGD volume, as we envisaged last year, power refinery around 0.5 MMSCMD in each of the sectors. Because of these reasons, we feel that the over-revised guidance of 127-128 is achievable. Therefore, we want to revise it. In respect of the coming financial year, we believe that our transmission volume will increase to 135-136 MMSCMD.
This largely will come from natural growth of CGD, which is taking place, and various refineries which are coming up, Barauni, Paradeep, Haldia, Bongao, Guwahati, and some other customers which will be coming up along our new pipelines. In respect of polymer, polymer production stood at 177, as I shared with you, as against 215 in the previous quarter. The Pata petrochemical complex was also under shutdown in April 25. There has been a loss of INR 249 crore. Largely why this is there is a loss, there is actually a reduction in the polymer prices by around INR 1,000 as compared to Q4 Financial Year 2025. This is leading to the major reason for reduction. Also in Q1, we see the shutdown impact also comes. We are taking all the measures to keep our Pata plant at a better level than this level.
We also expect that the current prices of the gas, we may also soften to we will be able to improve. As of date, this is a situation that we lost INR 249 crore on petrochemical plant Pata in Q1. LHC production stood at 199, I shared with you. We have posted PBT of INR 205 crore. There is a drop of 30% PBT from LHC segment as compared to last quarter. Which is primarily the reason we have shared the deallocation of APM gas and also subsequently allocation of new well gas, which is a costlier gas. Prices of LHC have also reduced by INR 2,000 per metric ton. I think this is the current quarter, the Q1 quarter performance I have shared. I have also shared our revised outlook and also the outlook of other segments.
I now hand over to you, Joshiji, to take us through. If there are any questions, the other investors and analysts, we will be happy to answer those questions. I am here and my colleagues from various departments, the marketing department, the product, the project development department, the finance, and city gas distributions are here. We will be happy to answer any of the questions you may have. Thank you very much.
Thank you, sir. We will now start with the Q&A session. Participants, please use the raise hand feature to ask any questions. In the interest of time, please limit the number of questions to two. With that, we will take the first question from Nitin Tiwari from Philip Capital. Nitin, please go ahead with your question.
Hi, good morning. I hope I am audible.
My question is related to the tariff revision that we had guided for in the earlier quarter, that most likely we are going to see that revision by the end of first quarter. Any renewed guidance over there? That would be my first question, sir.
Actually, in respect of tariff revision, we get guidance. We do not give guidance. We continue to follow up with the regulator. What I can update you about is the process part. The regulator has completed the process of consultation. They are now seized with the finalization of tariff, agenda for approval of their board, and we also are following. Now, any timeline, if I give, I have been giving a lot of timelines. If I say it comes in next month or I say maybe in October or September, it may not be correct.
What I can tell you is it has already been ordinarily delayed, and we as a company are following. We expect the tariff order to come as soon as possible. If I say August and I meet you in August, you will say it has not come because it is beyond my control. We expect it may come any time from now.
Got it, sir. My second question is with respect to the petchem business. This quarter, of course, was impacted by the plant shutdown that we wanted to take in. Can you give us some color in terms of how the market is looking in terms of product placement and whether we are finding any challenges with respect to placement of our products in the market in terms of pricing, etc.? When can we see a more secular trend in terms of profitability in this segment?
Because this segment has been suffering with operating losses for some time now.
Yeah. In terms of product offtake, there is no challenge. There is a good amount of demand available in the market. We do not even carry the stocks with us. The challenge is largely on the price part. We are going through a cycle, the pricing cycle, where there is a lot of availability of polymer in the international market that is also pushing the pricing pressure to price towards downward. And second, unfortunately, which we did not envisage last year, the hand rear price which we give to our Pata has almost doubled, which was average hand rear price last year was $1.88 per MMBTU. On an average basis, this quarter was $3.5 per MMBTU. That means the $1.7 per MMBTU and consequential duties and implications. This is putting a lot of pressure.
Though we are taking all the measures, let me tell you, we are regularly taking the hedging, doing hedging for input gas prices to reduce the prices for Pata petrochemicals. Yesterday, also, we took the hedging around $3 per MMBTU. We try to take all the measures. In terms of guidance, we do not feel that we will be very good in petrochemical business in this year. We may be able to reduce our losses. We may be trying to come nearer to break even level. I will not be able to give you any guidance. We say that we will be in black during this year as far as petrochemical business is concerned.
Understood. Thank you so much for asking my questions. I'll get back in you for further questions.
Thank you. We'll take the next question from Puneet Gulathi from HSBC. Puneet, please go ahead with your question.
Yeah, thank you so much. Thank you so much, Sanjeev, for your very candid talk. My first question is on your transmission guidance. While you did reduce your guidance for this year, even for next year's, you've brought it down to 135, 136. Why would you do that? If you can share more light on that.
Every year we'll not see the monsoon like this. Every year we'll not see the tripping of fertilizer plant like this. That is two major reasons which have brought down. Let me tell you.
No, your next year, I thought, was higher earlier, right? I mean, you were guiding for 140 plus.
We have already factored. We have now considered the base of the revised guidance of 2027, 2028 to give you the guidance for next year.
It means we have reduced the abnormality for this year and natural growth, the pipeline which are coming next year. For the purpose of guidance, we give guidance which is actually on ground. I could have revised my guidance of 2027, 2028 in next quarter, but I feel I should give you guidance which is actually realistic as on date.
Okay. Secondly, if you can also talk about this differential tariff impact for previous year, INR 133 crore. What is the nature of that?
Actually, what is. I understand you may be knowing what is integrated tariff and what is unified. Yeah. There is a mechanism in PNGRB that there is a settlement committee which takes the input from the entities with respect to their claim of respective pipelines. Because our claim is based on our pipeline uses. So there was a differential claim for some zones for previous year.
The two previous years are involved. 2023, 2024, and 2024, 2025. Those claims during settlement, we did not submit when last committee meeting took place. And then we submitted our claim and PNGRB has accepted. That's what I understand. That's a claim which do not pertain to this quarter. Claimed in this quarter. PNGRB acknowledged that there was a missing link in terms of our claim. There were lesser claim by us. That is that difference and which continues to happen sometime. It is on the higher side. But this time, this was a substantial figure. So therefore, I thought that let us cover in our opening remarks that INR 133 crore is one of which you should not consider that it is available always.
Understood. That's very helpful. Thank you so much and all the best.
Yeah.
Thank you.
We'll take the next question from Vivekanand S from Ambit Capital. Vivekanand, please go ahead with your question.
Yeah, thank you for the opportunity. Thanks for the frank and candid guidance on transmission. I know you covered some of this in the opening remarks. Could you delve a bit more, Mr. Jain, on the specifics of the granularity of demand, incremental demand that you expect in FY 2027 and FY 2028? FY 2026 seems to be lost given the first half being very weak compared to last year's base. If you could talk about specific sectors and also demand sources that you may have modeled in detail so that we can jot down. Thanks. That's the question.
I understand you are asking me the next year's projection and basis of our next year's projection. Is that right?
That's right.
We have given our revised guidance for 128.
And we have been experiencing that CGD is naturally growing at the rate of 12%. There may be some quarter-on-quarter difference. Even if you consider that demand, almost 5 million on country-level basis, the demand comes from CGD gas distribution. We being a pipeline infrastructure company, having almost 65%-70% of pipeline network for GAIL, on a ballpark basis, 3.5 million naturally comes from this sector which has been coming and this sector is regularly giving. Second, this quarter, we lost a lot of volume. Let me tell you, last year, we transported 131 million. This year, we transported 120. And a large part of it was from power sector, which was not expected. Today, when I am late, it is because of raining only. So because of the weather conditions, power demand was not there.
We expect at least 1-2 million on an average basis demand will be there from power sector, which has been there. Then we are commissioning new pipelines, like I shared in opening remarks, Kolkata section of the pipeline. We are commissioning Mumbai–Nagpur–Jharsuguda pipeline. We are commissioning Shikhanekola–Mangal pipeline. Volume has come from there. And the refineries which I shared, the Barauni Refinery, Paradeep, Haldia, Bongaigaon, Guwahati. What happened in this quarter? One unique thing, the alternative fuel prices were down. Therefore, refineries volume also reduced. They also switched over to alternative fuel. In fact, the spot demand which used to come regularly because of higher gas prices was not available. We do not believe that such situations will always be there. We believe in normal business. Therefore, all these things will give at least 8-9 million volume. 5-6 million is anyway available.
2-3 million volume has gone down this year and the natural growth. So 8 million volume to 9 million volume we expect will be available next year. This guidance is on a realistic basis and not a very padded guidance.
No, appreciate the color. Thank you. That really helps because otherwise, it is difficult for us to understand the path from 121 to 135. Thanks for that. My second question is on the petrochemical investments. You were planning to undertake an ethane cracker investment in Madhya Pradesh. Is there any further update on that? And secondly, can you just also refresh us on the other petrochemical projects that are currently underway where you have already committed capital and the project progresses somewhere in between?
So I shared in opening remarks, 160 KTA project we are putting at Pata. And it was because of the feed is available at Pata.
Another is PDHPP project at Usar. These two projects are going to be commissioned. The PP will be commissioned during this financial year. PDHPP will be commissioned next financial year. Regarding ethane cracker, let me tell you, we being a commercial organization. This I have been telling a lot of times. We being a commercial organization and having the wherewithal to invest in new projects, look for opportunities. Madhya Pradesh is one of that opportunity. We time to time evaluate the newspaper cuttings. You may have seen that those come. But in respect of decision of investment, we have not taken any decision on investment. Any decision on investment will be taken based on viability of project, whether that project is viable, what kind of incentives are available. If incentives are available, certainly making our, we are able to have our hurdle rates, we will take decisions.
We have not yet taken any decisions. We time to time evaluate various opportunities. The ethane cracker is one of those that opportunity we are reviewing and evaluating.
Thank you, Mr. Jain, for the detailed color. I'll join back the queue.
Thank you. We'll take the next question from S Ramesh, Nirmal Bang Equities. Sir, please go ahead.
Hello, can you hear me? Hello?
Yes, yes, we can hear you, sir. Please go ahead.
Good morning, sir. Thank you for the opening remarks and the details you've shared so far. If you look at the decision to defer the PDHPP project, can you highlight the reasons for this? Is there any concern in terms of the margins? Or is there any physical delay in the progress? And does it impact the capital cost for that?
Actually, there is no margin concern. Therefore, we have delayed the product.
We want this product to be completed as quickly as possible. One of the civil contract which is causing a problem, there are delays on that part, and that becomes a base part of any project. We are regularly reviewing that, and that's the only reason. Otherwise, nothing more than that.
What is the reason for the increase in the reduction in the depreciation from more than INR 1,000 crore to INR 800 crore?
Depreciation. INR 800 crore. If you look at the, my colleague Anjana will explain you.
Actually, we have assets which are fully depreciated, and any major overhauling or repairs is reflected in depreciation. We had carried out overhauling of our compressors, which has caused that which is not there in this quarter. Last year, we had full shutdown at Pata. This year, we had partial shutdown at Pata.
Even Pata also major overhauling and major spares were capitalized and fully depreciated. That is the change in the depreciation this time.
Okay, if I may squeeze in one last question. In the gas marketing segment, a bit. Between standalone and consolidated, there is a downside of around INR 400 crore from INR 1,071 crore to INR 660 crore. What is the reason for that decline in the gas marketing segment earnings in the consolidated entity?
Under the standalone, we are not, we are including CGD. Under the consolidated, we are separately showing CGD. Profit of CGD has been isolated from the console, standalone to console. If you see in the console figures, we have shown separately CGD.
You're saying the gas marketing in
the, there is a big swing from marketing to CGD
from standalone to consolidated.
Okay, but how can it be such a large swing?
That INR 400 crore seems to be a fairly large swing. Is there any negative impact on the subsidiaries?
If you see, overall, there is no change. We have multiple JVs and associates which are operating in CGD segment. One is GAIL Gas, Bengal Gas. It is the impact of those CGDs, the subsidiaries which we have taken.
So you're saying whatever marketing margins you have booked in standalone is shown under the CT Gas and this consolidated segment. Is that the way to understand that?
Yes, yes. Yes.
Okay, thank you very much. I'll follow the queue.
Thank you. We'll take the next question from Probal Sen , MyCICI Securities. Sir, please go ahead.
Am I audible? Hello?
Yeah, yeah. Prabhul, go ahead.
Yes, sorry, sir. Yeah, just one question, a broad question on the direction of crude prices and what impact it will have on our business.
On the one hand, obviously, crude prices go up. Term LNG prices and any other LNG linked to crude does go up. What we have seen is this peculiar situation where alternate fuel prices had actually gone down as a result of softness, which caused lower demand from downstream. Just wanted your view on what kind of scenario you see. If, say, let's say crude goes up by maybe another $5 from here, how do you see the mix of demand as well as the input costs playing out for us? That was my first question.
Crude prices, as everybody has been talking, they are largely expected to remain in the range of $60-$70 in the next few years.
However, we have seen earlier also, and which cannot be ruled out, is the geopolitical events which keep on happening very frequently and which tend to push the crude prices upwards on a few months. Otherwise, they are largely expected to remain in the $60-$70. As far as your question is concerned, some of the alternate fuels like naphtha, furnace oil, while they are correlated with the crude oil prices, they are also linked to the refining complexities. They are consistently remaining subdued, the alternate fuel prices, especially the propane and the naphthas, which are a matter of concern. What happened actually this year, the summer got whitewashed because the spot prices of natural gas never came down. They were not very high, but the summer phenomena didn't happen in the spot gas prices, which has resulted in lower natural gas demand, which could not compete with the alternate fuels.
This is slightly abnormal. Normally, the natural gas prices are able to compete even with the alternate fuels. That is why this year all these factors got combined.
Right.
Just as a follow-up, I mean, how do we then look at it if I look at the next, let's say, 12-18 months? Particularly, you also mentioned, I think, for Petchem, that Henry Hub prices, which is also a major component of our sourcing mix, those also have risen. If you look at our input cost scenario, basically going forward for the next 12-18 months, what do we really see in terms of our margins and pricing for Petchem, for LHC, as well as for the trading or marketing part? Just your view on just a very broad view in terms of how you see that evolve.
So Petchem.
We believe that the prices at the current level, the output prices are currently on a lower side. We believe that this should be up by maybe a few thousand rupees. That is actually putting pressure. Secondly, as I shared, the Henry Hub price, which we are using, is also not supporting us. Last year, it was substantially down. As my colleague also shared with respect to question or other, this is actually not a normal situation which we are experiencing that Henry Hub prices are higher. We believe that these prices to be softened. Time to time, we also regularly tracking the market and taking positions in paper market to keep the cost down. These, first, the optimism, our expectations that price will come down. Second, our actions on paper market will certainly help the Pata petrochemical to give its improved performance.
How much we are able to do that, really difficult to predict, but we'll say we'll be able to improve from the situation we are in today.
Understood. If I can squeeze in one last housekeeping question, CapEx guidance for financial year 2026 and 2027, if available, with a breakup between segments.
We have CapEx plan of around INR 12,000 crore in financial year 2026-2027. That largely will be pipeline projects around INR 4,000 crore, CGD projects, very small CapEx of around INR 200 crore, petrochemical projects INR 2,500 crore, E&P INR 500 crore. We have a net zero plan, and we are working on that around INR 2,000 crore. Then operational CapEx INR 1,400 crore, equity contribution INR 850 crore, and there are other projects INR 500 crore.
Understood, sir. Thank you so much for your detailed answers. I'll come back in the queue.
Thank you.
Thanks a lot.
Thank you. We'll take the next question from Sabri Hazarika from MK Global. Sir, please go ahead with your question.
Yeah. Regarding this transmission guidance, 127 is for the full year average. Is that right?
Yes, yes.
What is the run rate currently? The volume that we have lost, what you have mentioned when we fell to, like, say, around 120. Right now, fertilizer plants and all, they have normalized? Or right now, what could be the run rate if you're able to disclose?
Actually, the current run rate is hovering around the average which we expected and around 132. That means 127-130, 131, depending on the day. If it is Saturday, Sunday, not Saturday, Sunday, it goes down to the average of 127. If it is not Sunday, then it is around 130, 131. Also, it is depending on the weather conditions.
Fertilizer plants are almost now working at a normal level. We are running at around 127. Currently, if you talk of July, we are running at around 127 and sometime beyond that. Even someday, there will be one or two million lower. We have worked out from where this volume will come because as we are connecting pipelines, also that is not factored today. When you talk July, those pipelines are getting connected, those volumes will be added. All these we have worked out from where these volumes come. Again, to sum up, we are currently in this month working, running around transmission around 126, 127, sometime 130, 131.
This Dabol is operating normally this monsoon, right?
Dabol, yes. That is a positive for us.
Okay, sir. The second question is on this PDHPP. Right now, how are the margins of PDHPP?
Actually, when we considered this project, it was giving us beyond our hurdle rate. Even today, we are expecting around 13%-14% of project IRR. That is how we have recently also checked. Let us see how it goes. That is the current expectations.
This propane will be brought from the Middle East only, or are you looking at the U.S. and other things?
We have signed a long-term contract with BPCL for a 15-year contract. We will bring the propane at JETI. One contract is with respect to JETI. This is a bundle contract. They will supply us on a Saudi CP basis. That is the benchmark. Where from the source, what they do. For us, the index is fixed.
Okay, Aramco CP. Okay, sir. Thank you so much and all the best.
We will take the next question from Vikash Jain CLSA. Sir, please go ahead with your question.
Hi. Thanks for taking my questions. Thanks for the presentation. GAIL team and Rakesh Jain. Rakesh Jain, just one, since you mentioned that you are at 127 right now in terms of volumes in July as compared to less than 121 for the quarter. This extra, roughly six on an average, is this largely from fertilizer plants now operating normally as compared to the scheduled and unscheduled shutdowns that we saw in the first quarter? Or is there anything else which is more noticeable? It is primarily that bit, is it?
It is primarily that. Also, we were not operating our Pata petrochemicals during the first quarter. That was also on shutdown. That is also substantial. In terms of major volume, this is from two sectors, the fertilizer and also from Pata.
Sir, this to give a guidance of 128 means you are talking of possibly going well above 130, 132 at the exit levels. This incremental, is there hope built in that players like refinery, etc., will come back? Is there that is going to take volumes back to 128 on an average for the year?
No, that is part of that working.
Okay. Of the current volumes, what proportion is the more price-sensitive sectors like refinery and maybe petrochem? How much is of this 127 that you're currently doing in July? What proportion is refineries and what proportion is petrochemicals?
Yes, hold on. I'm asking my colleague in marketing. Say that refinery Petchem segment is roughly 20% of the whole basket. Going forward, why we are hopeful of achieving this number is primarily because, number one, Pata was shut down, as Sir has already conveyed.
There were some scheduled shutdowns of fertilizer plants, but there were also a lot of unscheduled shutdowns. All these three factors will not be there going forward: the scheduled shutdowns, the unscheduled shutdowns, and the Pata. We are still hopeful of some demand coming from the power sector in the late summers, like September, October, which normally comes back after the monsoon season, especially when the monsoon this year has happened very early.
Okay, sure. Just two last bookkeeping things. One is that this INR 133 crore would be revenues for the gas transmission segment. Just double confirming that, right? That's the extra.
Yes.
In your opening remarks, you mentioned that you've achieved a marketing margin, which I'm assuming is marketing EBIT of INR 994 crore, but I think the release has somewhere around INR 1,070 crore or something. Can you confirm which number or what is the difference?
Hold on. Hold on, hold on, Vikash. Hello?
Hi, sir.
you are talking about the publications, what we publish in the quarterly accounts.
That's right.
About only PBT levels.
Okay. So what INR 994 crore is the PBT level, you mean?
Yes.
The publication is EBIT. That's what you mean.
INR 1,071 crore. In fact, if you compare with guidance, it is INR 1,071 crore. That's what we did.
The guidance that you have of INR 4,000-4,500 crore, as against that, we have got INR 1,070 crore.
Similarly, we have been giving last year's guidance also.
Sure, sure. No, no, no. Just because that number was confusing. Thank you so much, sir. Thank you.
Thank you. We'll take the last question from Amit Murarka from Axis Capital. Amit, please go ahead with your question.
Yeah, hi. Hope I'm audible. Just a question on the PNGRB revision.
I believe it's been like more than one and a half years since we have been talking about it. I just wanted to know when this revision happens. It will be prospective, right? Just wanted to confirm that.
Yeah. Actually, regulation is like this. The month in which the tariff is approved, it is applicable from the subsequent month from the month it is approved. If it is approved, say, in July, it will be applicable in August. Only thing is that what PNGRB does, first they approve the tariff, then they ask entities to submit the general tariff. When we submit the general tariff, that is actually the approval. That's a very, very small process. That sometime also delays maybe by 15 days. It will be prospective.
Right. More or less, I mean, I believe three years anyways is the regular timeline for review of pipeline tariffs.
More or less, we are falling along those timelines now. If, let's say, it's getting delayed by further another six-eight months. I just wanted to reconfirm that. Will it still be an interim review, or how does it work?
Actually, there is nothing in regulations which is called an interim review. The periodical review happens in five years, but not before three financial years. This time, they called for submission of tariff. The PNGRB called because there is a provision in the regulation that if any change in substantial parameters, then either we can approach or they can ask if there was a substantial change in the parameter in terms of capacity or also in terms of gas prices. PNGRB, when they revised tariff last time, they considered significantly higher capacity. Later, they engaged EIL and based on the recommendation of EIL, PNGRB revised the capacity, which is downward.
Second, they considered the APM price of $3.61, which are non-existent prices. Now they have come out with the regulation that they will consider $11 as a gas price for fuel consumption. That's, of course, they have come recently, but that was in their mind. There were the reasons they did not follow the regular timeline. It is in terms of regulation only that can be called for. There is nothing like interim, but you can say because of changing parameters, they can revise in interim. In that sense, it is interim.
Thank you, sir. That was the last question. Over to you for any closing remarks. Sir, requested to unmute your line for any closing remarks.
Sorry. Thank you very much. It was a nice interaction with you all. I hope we were able to answer most of your questions. Maybe all the questions.
If you or investors may have any more questions, certainly we welcome you. You can connect with our MEC and IR team, which will be happily responding to any more questions you may have, which we could not answer or we could not ask. Thank you very much.
Bye.