Gujarat State Petronet

Gujarat State Petronet (GSPL) organtsed a conference calion 26 July 2009. AssIstant General Manager Finance Mantsh Seth and General Manager Commercial Ravindra Agrawal addressed the call Highlights:
After a dismal performance in Q3 Decem­ber 2008 and Q4 March 2009 of fiscal ended March 2009 (FY 2009), GSPL bounced back in Q1 June 2009 of FY 2010. Net profit grew 147% to Rs 80.49 crore and net sales 76% to Rs 210.82 crore. The company sup­plied around 25 million standard cubic metres per day (mscm) per day of gas vol­ume in QI ofFY 2010 as against 12.8 mscm per day of gas in Q4 FY 2009.
The improvement in gas volume was accompanied by two factors. The increase in naphtha price removed the mismatch in gas and naphtha prices. This had delayed the renewal oflong-term gas contracts, which were done in the quarter. Thus, volume spurted. Second was the pent-up demand in the spot market and new supply coming from Petronet LNG and Reliance Industries' (RlL) Krishna-Godavari (KG) D6.
GSPL supplied around seven mscm per day from RlL's KG basin. Of this, around two mscm per day was supplied to RlL for testing. RlL was also supplied around five mscm per day for its Jamnagar refmery from Petronet LNG. Around 1.5-2 mscm per day of gas was supplied to Torrent Power. Gradu­ally, this gas will stabilise to around four mscm per day during the course ofthe year. More clarity on the volume of gas exclu­sively for RIL and for other players is awaited from regulatory authorities.
By July 2009, GSPL shipped around 30 mscm per day of gas. The key sources of gas are around 12 mscm from Petronet LNG, 10 mscm from RIL's KG D6, four mscm from Cairn India's Panna-Mukti­Tapti gas field, and the rest fi;om other mis­cellaneous sources. Overall, with more gas coming from RIL's KG basin and Petronet LNG, the company aims to ramp up vol­ume to 40 mscm per day by year end. Next year, it expects to increase supply to more than 45 mscm per day, with growth mainly from the KG gas basin.
The average tariff stood at Rs 915 per
II
trillion cubic metre (tcm) in the quarter. This, however, includes a combination of long­term and spot-price contracts and, hence, cannot be considered as benchmark tariff.
No take-or-pay revenue accrued in the quarter as all long-term players picked up the volume and adhered to the contract, un­like in Q4 of FY 2009, when they carried higher inventory of low-cost naphtha and went for take-or-pay clause. RlL and Tor­rent Power's take-or-pay clause continues to be in litigation. Take-or-pay clause stipu­lates that the customer takes the fixed quan­tity of gas or else has to pay a fix price, irrespective of offtake.
GSPL added around 100 km of pipeline connecting Rajkot and Jamnagar in Q4 ofFY 2009 and Bhabdhut and Gana in Q 1 of FY 2010. With this, the current length of pipe­line in Gujarat is at around 1,400 km. Fur­ther, three more pipelines of total length of around 450-500 km connecting Anjar-Morbi­Mudra, Darud-Pipavav and Anand-Rajkot will be laid before FY 2011. This involves a capex of around Rs 1500 core.
GSPL's current gross block stands at Rs 2700 crore and debt around Rs 1200 crore. Debt will be of around Rs 1900 crore by year end, given the capex required for the expansion of the network. These new pipe­lines will transport around 10 mscm per day of gas once volume is ramped up. The incre­mental gas will be from Petronet LNG and RlL's KG gas basin.
A lot will depend on the spot gas require­ment and volume of gas sold for GSPL to maintain the operating profit margin of around 94% (achieved in QI of FY 2010). However, margin of around 89% (87% re­ported in FY 2009) is very much sustainable.
1(10 Bank Focus on 4 Cs
Capital preservation, credit monitoring, CASA improvement and cost control to boost margin
ICICI Bank conducted its conference calion 25 July 2009 to dISCUSS its first quarter re­sults ended June 2009. The call was ad­dressed by CFO N S. Kannan and Deputy CFO Rakesh Jha. Highlights oJthe call'
1CICI Bank's standalone net interest in­come dipped 5% to Rs 1985.26 crore, with advances falling 12% in the quarter ended June 2009 over the June 2008 quarter. However, net profit rose 21 % to Rs 878.22 crore on jump in other income by 36% to Rs 2089.88 crare. Net interest margin stood at 2.4% compared with 2.6% end March 2009 owing to decline in advances and ex­cess liquidity maintained in the balance sheet. Treasury income recorded a profit of Rs 714 crore compared with a loss of Rs 594 crore in the corresponding previ­ous quarter. Fee income for Q I June 2009 of fiscal ended March 2010 (FY 2010) stood at Rs 1319 crore - same as that of the March 2009 level.