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Mahanagar Gas Ltd has outlined a capital expenditure plan of around INR 1,200-1,300 crore for the next financial year, broadly in line with current spending levels. The city gas distributor is evaluating acquisitions of renewable energy assets while continuing pilot projects in green hydrogen and compressed biogas. Alongside diversification, the company plans to expand its CNG, LNG and domestic PNG network across Mumbai and nearby regions, while preparing for further reduction in government-allocated gas supplies.
Mahanagar Gas Ltd (MGL), which supplies compressed natural gas and piped natural gas across Mumbai and adjoining parts of Maharashtra, has firmed up a capital expenditure plan of around INR 1,200-1,300 crore for the next financial year. The proposed investment is in line with the current year's spending and will focus on expanding core gas infrastructure while supporting the company's transition towards cleaner and alternative energy segments. Advertisement
The company is actively assessing opportunities to acquire renewable energy assets as part of its longer-term diversification strategy. Management has indicated that MGL is also running pilot projects related to green hydrogen and is evaluating investments in compressed biogas plants. These initiatives are aligned with the company's stated target of achieving net-zero emissions by 2036 and reducing dependence on conventional fossil fuel-based operations over time.
On the infrastructure front, MGL plans to add nearly 70 new CNG stations in the next financial year, following the addition of about 75 stations in the current year. The company is also planning to commission three to four new LNG stations, building on the three LNG stations that were recently made operational. These additions are aimed at supporting rising demand from commercial transport and long-haul vehicles as fuel preferences gradually shift.
In the residential segment, MGL intends to add around 350,000 new domestic PNG connections in the coming year. Expansion of household connections remains a key growth driver, supported by steady urban demand and wider pipeline network coverage in its licensed areas.
MGL has also been preparing for a gradual decline in gas supplied at administered prices. With previous cuts already absorbed, the company has diversified its sourcing through a mix of new well gas, high-pressure high-temperature gas, Brent-linked contracts, spot purchases and exchange-based procurement. Management has indicated a preference for Brent-linked contracts due to better liquidity and pricing visibility, and does not expect sharp gas price volatility over the next couple of years.
Beyond gas, the company has taken initial steps into electric mobility and energy storage. MGL has acquired a stake in an electric vehicle manufacturing company and is exploring opportunities in battery manufacturing, particularly as battery costs continue to soften. These moves indicate a broader approach to remaining relevant in India's evolving energy and mobility landscape.
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