Adani Total Gas Share Price

Adani Total Gas Limited fundamental analysis of gas distribution company

This article explores Adani Total Gas Limited from scratch so as to understand its various business models, and industries and evaluate if it is an investment fit for you.

Adani Total Gas Limited

Adani Total Gas Limited is a joint venture between the Adani Group and Total Energy, each holding a 37.4% stake. The company has made a commitment to build City Gas Distribution (CGD) networks across the country.

It provides a continuous supply of Piped Natural Gas (PNG) and Compressed Natural Gas (CNG) to various sectors including industrial, commercial, domestic (residential), and transport.

Apart from its core business, Adani Total Gas Limited has diversified into electric vehicle (EV) charging, biogas, and liquefied natural gas (LNG). This company aims at providing cheap affordable services that are readily available at all times therefore reaching out to millions of people all over the world.

It also makes a substantial contribution in terms of energy security and environmental conservation within the country.

Is the gas distribution sector a goldmine investment?

The gas distribution sector in India is witnessing significant growth and investment. The Prime Minister of India, Narendra Modi has announced an investment plan worth 67 billion dollars to be spent within the next five or six years on natural gas supply chains.

This investment is intended to enable India to meet its energy needs as it is the third largest consumer globally. In addition, the main goal of this project is to increase Natural Gas’ share in the Indian Energy Basket from 6.3% at present to 15% by 2030.

Additionally, Indian Oil and Gas Market size is projected to be valued at around USD 38.12 Billion cubic meters in 2024 and is expected to reach USD 49.12 Billion cubic meters by 2029 with a CAGR of over 5.20 % during the forecast period (2024-2029).

Adani Total Gas Limited, with its ambitious investment plans and focus on expanding its gas distribution network, aligns well with India’s goal to increase the share of natural gas in its energy mix. Adani Total Gas Limited could be considered a viable choice for investing due to the positive prospects of the gas distribution industry coupled with the company's strategic placement.

Who are Adani Total Gas’ competitors in the gas distribution sector?

Adani Total Gas Limited operates in a competitive environment in the Gas Distribution Sector. Some of its key competitors include:

• GAIL (India) Ltd.
• Gujarat Gas Ltd.
• Gujarat State Petronet Ltd.
• Indraprastha Gas Ltd.
• Mahanagar Gas Ltd.

History of Adani Total Gas Ltd.

Here's a concise summary of its past:

• Incorporation: Adani Total Gas Limited was originally incorporated as ‘Adani Gas Limited’ on August 5th, 2005 in Navrangpura, Ahmedabad. The company changed its name to “Adani Total Gas Limited” on January 1st, 2021.
• Product range: The company is developing City Gas Distribution (CGD) networks to supply Piped Natural Gas (PNG) and Compressed Natural Gas (CNG) to various sectors including industrial, commercial, domestic (residential), and transport. It has also ventured into e-mobility and biomass businesses.
• Infrastructure: Adani Total Gas Ltd. is aiming to invest Rs 16,000-Rs 18,000 crore to set up city gas distribution infrastructure across its geographical areas over the next seven to eight years. It also aims to build a fuel retail network of 1,500 retail stations.
• Certifications: The company has received ratings from ICRA, which considers its promoters’ strong profile with equal holding (37.4%) by Total Energies SA (Total; rated A1(Stable)/P1 by Moody’s) through Total Holdings SAS and the Adani family.
• Awards and recognition: Adani Total Gas has received the Golden Peacock HR Excellence Award 2020 and won at the ET EnergyWorld Annual Conclave. It has also been awarded the Good Corporate Citizen Award for the year 2022 by PHD Chamber of Commerce and Industry (PHDCCI).

Company profile of Adani Total Gas Ltd.

Pros:

• Strong growth: Adani Total Gas Ltd. is expected to experience strong growth in 2024. The company’s revenue from operations grew to INR 4,813 crores, up by 3%.
• Profitability: The company posted an increase of 23% in standalone net profit at ₹653 crore as compared to ₹530 crore in the previous fiscal.
• Efficiency: The company efficiently uses its assets to generate profits with a high ROA (Return on Assets) of 11.25%.
• Infrastructure expansion: The company has built 91 new CNG stations, and the network has now increased to 547 stations.

Cons:

• High valuation: The PE Ratio (Price to Earnings Ratio) of 182.03 is high, suggesting the stock may be overvalued.
• Market volatility: Market volatility might lead to fluctuations in the stock price.
• Stock performance: As of June 11, 2024, the stock of Adani Total Gas Ltd suffered a -2.08% drop. This could indicate potential volatility or ongoing challenges in the company’s performance.

Finances

Here’s a summary of Adani Total Gas Limited’s financial information as of June 2024:

Shareholding pattern of Adani Total Gas Ltd.

Here’s a concise summary of Adani Total Gas Limited’s shareholding pattern as of June 2024 :

• Promoters: Hold 74.8%
• Foreign Institutional Investors (FII): 13.1%
• Domestic Institutional Investors (DII): 6.1%
• Public: 5.9%

Peer multiple comparison

Let’s compare Adani Total Gas Limited with its peers that have complete data available. Here’s a concise table: