Q2 Concall Summary and Key Pointers
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Just compared the valuations as on today wrt 2018 from this article,
|Parameter | From 2018 | as on today | remark|
| PE | 17.5 | 10.6 | attractive |
| PB | 4 | 1.7 | attractive |
| Benjamin Graham number| 70.4 | 18 | good margin of safety |
| PEG | 0.21 | 0.59 | undervalued |
| Dividend Yield | 2.2 | 2.83 | good |
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The February 28, 2026 US-Israel strikes on Iran triggered Iranian threats to close the Strait of Hormuz—a critical route handling 54% of India’s LNG imports. This directly hits the one-third of MGL’s gas supply sourced via RLNG (~1.35-1.4 mmscmd term RLNG + spot) .
Since the moment i heard the news that supply of LNG would be disrupted based on the Iranian threats, just started to think through the impacts on the CGD sector & MGL’s source gas impact.
From MGL’s last year 2025 investor presentation, i got to know MGL employs a diversified sourcing mix—APM, HPHT, term RLNG, spot RLNG, and domestic gas—for supplying CNG, D-PNG, and I&C customers.
I’m not sure how much of weightage on the sourcing mix. Just tried to use the AI tools to understand the impact on pre-crisis vs cost rises.
Cost Impact for MGL
Pre-crisis baseline:
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Blended cost: ₹30.04/SCM
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RLNG component: ₹40-42/SCM
Expected shock:
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RLNG costs surge 30-50% to ₹52-63/SCM due to supply disruption and rerouting
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Blended cost rises to ₹35-40/SCM (16-33% increase)
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Additional cost burden: ₹5-10 per SCM
Like MGL, all major players (IGL, MGL, ATGL, GAIL Gas) face similar exposure since 20-40% of their sourcing relies on RLNG through Hormuz. Sector-wide margin compression of 15-25% is likely in Q4 FY26 and Q1 FY27.
upcoming quarters may have the margin compression, due to the possible cost rise. Also, will govt step in to support CGD sector by increasing the APM allocation. will have to wait and watch.
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