Petronet LNG Limited — Q4 FY26 earnings call

Call held 5 May 2026

Management summary

Petronet LNG delivered a strong financial performance in Q4 FY26, with significant YoY and QoQ growth in PAT and PBT, despite geopolitical challenges in the Gulf region. The Dahej terminal maintained high utilization for the quarter, though March saw a dip, while Kochi achieved record annual throughput. The company is diversifying its supply sources and progressing well on its major petrochemical and infrastructure capex projects, with a positive outlook for supply normalization.

Highlights

  • PAT for Q4 FY26 stood at INR 1,338 crore, up 25.04% YoY and 57.78% QoQ.

  • PBT for Q4 FY26 stood at INR 1,795 crore, up 24.14% YoY and 56.90% QoQ.

  • Dahej terminal maintained strong utilization at 90.1% in Q4 FY26, despite the Gulf crisis.

  • Kochi terminal achieved its highest ever annual volume throughput of 68 TBTU in FY26.

  • Company received INR 630 crore for outstanding Use of Pay dues from calendar year 2022.

  • New LNG supply contracts with Exxon and Equinor commenced, adding approximately 1 million tons in FY27.

Concerns

  • Overall LNG volume processed declined by 6% QoQ to 219 TBTU in Q4 FY26.

  • Dahej capacity utilization in March 2026 dropped significantly to 53% due to the Gulf crisis.

  • Uncertainty regarding the exact timeline for full Qatar supply resumption post-conflict.

Key financials

  1. PAT ₹1,338 Cr +25%YoY
  2. PBT ₹1,795 Cr +24.1%YoY
  3. Overall LNG volume processed 219 TBTU +6.8%YoY
  4. Dahej capacity utilization 90.1%
  5. Regas revenue ₹879 Cr
  6. Inventory gain ₹95 Cr

What they filed

Q1 FY27: revenue down 53.2%, net profit up 35.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue13,024 12,227 12,316 11,880 11,009 −15%11,164 −9%9,442 −23%5,558 −53%
EBITDA1,202 1,247 1,512 1,159 1,117 −7%1,198 −4%1,861 +23%1,535 +32%
Net profit871 902 1,095 842 830 −5%870 −4%1,371 +25%1,137 +35%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence
  • Capex ₹390 Cr this quarter · ₹9,000 Cr (FY27) planned
    • Petchem project ₹7,500 Cr
    • Third jetty ₹600 Cr
    • Gopalpur terminal ₹300 Cr
    • Fifth small scale LNG plant at Kochi ₹70 Cr
    • Additional tank in Kochi ₹1,200 Cr
    Okay, so far as the capitalization is concerned, yes, we have commissioned the project apart from a particular facility. So, excluding that particular facility which will be commissioned in this current quarter, the entire expansion capacity has been commissioned and capitalized. ... We have capitalized INR 390 crores and balance around INR 100 crores will be capitalized in the next quarter. ... And I think you had also asked about the proposed CAPEX budget for the current financial year. So, it is around INR 9,000 crores. ... So, far as the proposed CAPEX budget for the current financial year is concerned, the major amount will be spent on the Petchem project only. So, that is about INR 7,500 crore plus minus, you can assume 10%. ... And the rest are all like the third jetty that we are constructing. So, around INR 600 odd crores on the third jetty. And Gopalpur terminal also, we are planning to start our activities, construction activities in this current year. So, there also we plan to spend around INR 300 crores to INR 400 odd crores. ... And we are planning to spend around INR 70 odd crores in that particular project. ... Any CAPEX number in your mind for the one additional tank in Kochi? So, it is about around INR 1200 crores.
  • Dividend ₹3/share (final)
    Considering the robust performance, the Board of Directors has recommended a final dividend of INR 3 per share for the financial year 2025-2026.

Guidance & targets

Capex

  • Total Capex Capex · FY27 · Medium confidence around INR 9,000 crores
    And I think you had also asked about the proposed CAPEX budget for the current financial year. So, it is around INR 9,000 crores.

    — Saurav Mitra

  • Petchem Project Capex Capex · FY27 · Medium confidence about INR 7,500 crore plus minus, you can assume 10%
    So, far as the proposed CAPEX budget for the current financial year is concerned, the major amount will be spent on the Petchem project only. So, that is about INR 7,500 crore plus minus, you can assume 10%.

    — Saurav Mitra

  • Third Jetty Capex Capex · FY27 · Medium confidence around INR 600 odd crores
    And the rest are all like the third jetty that we are constructing. So, around INR 600 odd crores on the third jetty.

    — Saurav Mitra

  • Gopalpur Terminal Capex Capex · FY27 · Medium confidence around INR 300 crores to INR 400 odd crores
    And Gopalpur terminal also, we are planning to start our activities, construction activities in this current year. So, there also we plan to spend around INR 300 crores to INR 400 odd crores.

    — Saurav Mitra

  • Fifth Small Scale LNG Plant at Kochi Capex Capex · FY27 · Medium confidence around INR 70 odd crores
    And we are planning to spend around INR 70 odd crores in that particular project.

    — Saurav Mitra

  • Kochi Additional Tank Capex Capex · Medium confidence around INR 1200 crores
    Any CAPEX number in your mind for the one additional tank in Kochi? So, it is about around INR 1200 crores.

    — Saurav Mitra

  • Total Capex Capex · FY28 · Medium confidence similar to this INR 9,000 crores of '27
    Yes. As has been discussed in the last call also, basically the FY '27 we are saying INR 9,000 crores and FY '28 also should be at the same level around 10% more or less.

    — Debabrata Satpathy

Infrastructure

  • Kochi-Bangalore pipeline completion Infrastructure · H1 FY27 · High confidence September 26th
    What is the status of this Kochi-Bangalore pipeline? What I know, I think that the GAIL has pushed the timeline to, I think, September 26th. So, is there any update for this? Whatever information you have, it's perfectly in order. Okay. It's the first half of FY '27. Yes.

    — Saurav Mitra

What to watch in Q1 FY27

Qatar LNG supply status

Within 3-4 weeks of conflict end (expected June onwards)
Current Impacted by Gulf crisis, March utilization at 53%
Target Resumption of full supply from Qatar

Why it matters

Direct impact on terminal utilization and overall profitability.

So, we are in constant touch with Qatar Energy and we are hopeful that the moment this conflict comes to an end, within three to four weeks, supply should resume.

Risks & concerns

  • Geopolitical conflict in Gulf region impacting LNG supplies

    high

    Ongoing crisis in the Gulf region led to a dip in March utilization, but management is diversifying supply and expects resolution within 3-4 weeks post-conflict end.

    despite the challenging external environment arising from the ongoing crisis in the Gulf region.

    Management acknowledged

  • Uncertainty of Qatar supply resumption timeline

    medium

    Management is in touch with Qatar Energy but finds it difficult to give firm numbers for future utilization due to the unpredictable nature of the conflict.

    So, it is very difficult to give a number at this point of time.

    Management acknowledged

  • Land availability for Dahej expansion

    medium

    Land is an issue for putting up additional storage tanks at Dahej, but the company is actively scouting for land parcels.

    land is an issue, availability of land is an issue in Dahej, but we are actively scouting for some additional land parcel wherein we will be able to put up some 3 to 4 additional tanks.

    Management acknowledged

Q&A highlights

7 direct
March utilization and potential volume at risk for FY27 due to Gulf crisis Direct
So, the Dahej capacity utilization during March was around 53% and Kochi was slightly more than 20%. ... So, in a percentage term, it may look on a lower side, but absolute utilization vis-a-vis last year, it should be comparable.

Provides specific March utilization numbers and management's view on the impact of the Gulf crisis on future volumes, indicating resilience despite challenges.

Asked by Probal Sen

Role of additional LNG supplies (especially from US) in balancing the Asian market Direct
Supply is not just US, US is one of them, of course. But then Oman, which is very close to India, those supplies continue to come in. Mozambique, there are new countries like Nigeria and Congo, we got a cargo from Congo, we got a cargo from Mauritania and Senegal. So, all these new supplies are adding up and this is supporting. And interestingly, you will be aware that a new contract with Exxon, which we signed in 2017, supplies under that contract also started. So, in April, we got the first cargo under that contract.

Highlights diversification of supply sources beyond traditional ones and the commencement of new contracts, which helps mitigate geopolitical risks.

Asked by Probal Sen

Communication with Qatar regarding supply resumption post-conflict Direct
So, we are in constant touch with Qatar Energy and we are hopeful that the moment this conflict comes to an end, within three to four weeks, supply should resume.

Provides a clear timeline for potential supply normalization from Qatar, which is crucial for utilization levels.

Asked by Puneet Gulati

Status of petrochemical project and potential delays due to supply chain Direct
So, far as the project activity for petrochemical plant is concerned, the project is absolutely on track because the capital equipment generally don't come from the Gulf region. So, whatever imports are there, they come from Japan, Korea, China and from Europe and US. So, that way, so far as supply of equipment, plant and machinery is concerned, there is no issue.

Reassures investors about the progress of a major capex project, mitigating concerns about geopolitical supply chain disruptions.

Asked by Puneet Gulati

Clarification on the UOP accounting treatment, specifically the reversal and new provisions Direct
So, Nitin, coming to this provision question, the reversal is INR 550 crores for CY '22 and for CY '23, the provision is INR 35 crores and CY '24, the provision is about INR 6 crores. ... And there is also a waiver, because of the higher volume brought, waiver of about INR 13 crores in the current quarter. So, if you adjust these INR 35 crores, INR 6 crores and the INR 13 crores from the INR 550 crores, you will get the number of INR 496 crores.

Provides a detailed breakdown of the UOP adjustments, clarifying the financial impact and the components of the reported figures.

Asked by Nitin Tiwari

Expected utilization levels for FY27 assuming Qatar supplies normalize from June Partial
See, we firstly, we have never said that May onwards things will be back to normal, because it all depends on the conflict in the Middle East region, how it spans out and what happens and when Qatar resume supplies. So, it is very difficult to give a number at this point of time.

Highlights the uncertainty surrounding the geopolitical situation and its direct impact on the company's ability to provide firm utilization guidance, indicating a key risk factor.

Asked by Pritesh Chheda

Additional volumes from new contracts with Equinor and Exxon Direct
Yes. These two volumes, which are additional, is what number? Roughly 1 million tons in this year.

Quantifies the additional volume expected from new contracts, providing a positive outlook for throughput, even if overall utilization remains uncertain.

Asked by Pritesh Chheda

Plans for increasing storage facilities given the national need for more storage Direct
So, for our Gopalpur project, we have already announced that we will be constructing two tanks and we are also planning to set up one more tank in Kochi. So, that's, right now we can say our current plan is all about increasing the storage. However, as mentioned by our CEO yesterday in the press conference that some more tanks are also being planned at Dahej and we are looking for land because land is an issue, availability of land is an issue in Dahej, but we are actively scouting for some additional land parcel wherein we will be able to put up some 3 to 4 additional tanks.

Details the company's strategic plans for infrastructure expansion, addressing a critical national need and indicating future growth avenues.

Asked by Sarthak

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Detailed narrative

Strong Financial and Operational Performance in Q4 FY26

Petronet LNG reported a robust financial performance in Q4 FY26, achieving its highest ever quarterly PBT and PAT. PBT stood at INR 1,795 crore, a 24.14% increase YoY, while PAT reached INR 1,338 crore, growing 25.04% YoY. This performance was delivered despite a challenging external environment due to the ongoing crisis in the Gulf region, reflecting the resilience of the company's operations and commitment of its teams. The company also received INR 630 crore in outstanding Use of Pay dues pertaining to calendar year 2022.

Operational Performance and Terminal Utilization

The overall LNG volume processed in Q4 FY26 was 219 TBTU, a 6.8% increase YoY but a 6% decline QoQ. The Dahej terminal processed 201 TBTU, maintaining a strong capacity utilization of 90.1% for the quarter. However, March 2026 saw a significant drop in Dahej utilization to 53% due to the Gulf crisis, though January and February averaged 108%. The Kochi terminal achieved its highest ever annual volume throughput of 68 TBTU for FY26, marking an encouraging milestone.

Strategic Supply Diversification and New Contracts

To mitigate geopolitical risks, Petronet LNG is actively diversifying its LNG supply sources beyond traditional regions. New supplies are coming from Oman, Mozambique, Nigeria, Congo, Mauritania, and Senegal. Notably, a new contract with Exxon, signed in 2017, commenced in April 2026, with the first cargo received. This contract, along with a new one with Equinor, is expected to add approximately 1 million tons of volume in FY27, supporting overall throughput.

Capital Expenditure Plans and Project Progress

The company has ambitious capex plans, with a proposed budget of around INR 9,000 crore for FY27, and a similar amount for FY28. The major portion, approximately INR 7,500 crore, is allocated to the petrochemical project, which is progressing on track with equipment sourced globally. Other significant capex includes INR 600 crore for the third jetty, INR 300-400 crore for the Gopalpur terminal, and INR 70 crore for a fifth small-scale LNG plant at Kochi. INR 390 crore was capitalized in Q4 FY26, with another INR 100 crore expected in Q1 FY27.

UOP Dues and Accounting Adjustments

The company provided a detailed breakdown of the Use of Pay (UOP) accounting adjustments. A reversal of INR 550 crore was made for CY22, while provisions of INR 35 crore for CY23 and INR 6 crore for CY24 were recorded. Additionally, a waiver of INR 13 crore was granted in the current quarter due to higher volumes. After adjusting for these provisions and waivers, the net reversal amounted to INR 496 crore. The regas revenue for the quarter was INR 879 crore, with an inventory gain of INR 95 crore.

Outlook on Qatar Supply and Future Utilization

Management is in constant communication with Qatar Energy and is hopeful that LNG supplies will resume within three to four weeks once the Gulf conflict ends, potentially from June onwards. While a specific utilization target for FY27 cannot be provided due to geopolitical uncertainties, the company expects an improvement from the March lows. The commencement of new contracts and growing Indian gas demand, particularly from the power sector, are expected to support increased utilization.

Storage Infrastructure Expansion

Addressing the national need for increased storage, Petronet LNG is actively expanding its infrastructure. Plans include constructing two tanks at the Gopalpur project and one more tank at Kochi. The company is also scouting for additional land parcels at Dahej to potentially add 3 to 4 more storage tanks, although there are no immediate plans for these. The additional tank in Kochi is estimated to cost around INR 1200 crore.

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