Mahanagar Gas Limited (MGL) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Mahanagar Gas Limited Q2 FY '24 Earnings Conference Call hosted by PhillipCapital India Private Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Nitin Tiwari from PhillipCapital India Private Limited. Thank you, and over to you, sir.

Thanks, Rico. Good evening, ladies and gentlemen. On behalf of PhillipCapital India Limited, I welcome everyone to Mahanagar Gas Limited's Second Quarter Earnings Call. We have the pleasure of having with us the senior management team from Mahanagar Gas Limited, represented by Mr. Ashu Shinghal, Managing Director; Mr. Sanjay, Deputy Managing Director; Mr. Rajesh Patel, Chief Financial Officer, Mr. Rajesh Wagle, Senior Vice President, Marketing. I shall now hand over the floor to the management for their opening remarks, which shall be followed by a Q&A session. Over to you, [ Runjhun ].

Thank you, Nitin. Welcome to the participants in this call. Before we begin, I would like to mention that some of the statements made in today's discussion may be forward-looking in nature, and we believe that the expectations contained in the statements are reasonable. However, these statements involve a number of risks and uncertainties that may lead to different results. The risks related to these statements are included, but not limited to fluctuations of sales volume, foreign exchange and the cost of an ability to manage growth. I urge you to consider the quarterly numbers are not a reflection of long-term trends and indications of full year results. This should not be attempted to be extrapolated or interpolated into full year number. With that said, I will now hand over the call to management. Thank you, sir.

Good afternoon, and welcome to the earnings call of Mahanagar Gas Limited for the second quarter of the financial year '23-'24. I would like to thank all of you for attending our earnings call today. During the quarter, gas prices led to different indices as well as spot LNG have remained stable. HPHT gas ceiling price has reduced with effect from October 23 from $12.12 to $9.96 per MMBtu. Stable gas prices and availability of APM plus HPHT gas for CNG and PNG, available to domestic PNG, available to CGDs on priority will help offering competitive price compared to alternate fuel prices. And accordingly, MGL has reduced prices of CNG by INR 3 per kg from INR 79 to INR 76 per kg and domestic PNG price from INR 2 -- by INR 2 per SCM. That is from INR 49 to INR 47 per SCM. Currently, CNG offers attractive savings of more than 50% compared to petrol and almost 20% compared to diesel prices in Mumbai. MGL continues to create CGD infrastructure across its licensed areas. During the quarter, 43,051 domestic households were connected and thus, we have established connectivity for nearly 2.25 million households. We have also laid 40.31 kilometers of steel and PE pipeline, whereby taking the aggregated length of pipelines to over 6,653 kilometers. We have added 7 CNG stations. And with this, we have 319 CNG stations as on 30th September '23. We also have added 120 industrial and commercial customers during this quarter. And thus, as on 30th September, we have 4,639 industrial and commercial customers. In respect to our Raigad GA, we have connected 70,654 domestic households and 32 CNG stations are currently operational. During this quarter, we laid 3.75 kilometer pipeline in Raigad GA, taking the total length to 393 kilometers. This expansion of our pipeline network has created a very good ecosystem for CNG and PNG in Raigad. The first CGS and first mother filling station in Savroli in GA-3 has also been commissioned, and this will now enable expeditious unlocking of demand in Raigad. During the quarter, MGL has commissioned its LNG station in Savroli and LNG sales to B2B customers has commenced during this quarter also. Coming to MGL's operation during the quarter, we achieved overall average sales volume of 3.575 MMSCMD as against 3.412 MMSCMD in the last quarter, which is an increase of 4.1%. Current quarter volume consists of CNG volumes of 3.583 MMSCMD, domestic PNG of 0.491 MMSCMD and 0.501 of gas was supplied to industrial and commercial. Compared to the previous quarter, sales volume increase in the CNG has increased from 2.481 to 2.583 MMSCMD, that is an increase of 4.1%. In case of industry and commercial, sales volume has increased from 0.435 MMSCMD to 0.501, an increase of 15%, whereas sales for domestic PNG has marginally decreased from 0.496 to 0.491 MMSCMD, which is a decrease of 0.9%. Overall gas sales for H1 of the current financial year compared to the corresponding H1 of the last financial year has increased to 3.494 from 3.453 MMSCMD, that is an increase of 1.2%. H1 volume consists of CNG volume of 2.532, domestic PNG of 0.493 and 0.468 MMSCMD of gas to industry and commercial segment. Current quarter EBITDA is INR 479 crores compared to previous quarter EBITDA of INR 521 crores. Net profit after tax is INR 338 crores for this quarter as compared to INR 368 crores in the last quarter. Current half yearly EBITDA is INR 1,000 crores compared to previous year half yearly EBITDA of INR 538 crores. Net PAT is INR 707 crores for this half yearly result as compared to INR 349 crores in the H1 of last year. We would like to further touch upon EV policy, which is a major development in Delhi region. Government of NCT, that is National Capital Territory of Delhi, has approved the scheme of motor vehicle aggregators and delivery service providers 2023, subject to approval of Delhi Governor's office. The scheme is for licensing and regulation of MVA, providing passengers transport service and DSP for delivery service of goods and commodities, including last mile connectivity in NCT of Delhi. The Delhi mandates switch to EV from existing conventional vehicles. In case of 3-wheelers, switch to EV mandated on net new onboarded vehicle sales from 10% to 100% in a span of 6 months to 4 years. In case of 4-wheelers, passengers and good vehicles, switch to EV mandated on the net new onboarded vehicles is from 5% gradually to 100% next 5 years. The aggregator shall switch to an all-electric fleet by 1st of April 2030, whereas the primary objective of Maharashtra Draft EV Policy 2021 is to accelerate adoption of EV in the state so that they contribute to 10% of new vehicle registration by 2025. For urban areas, including Mumbai, targeted EV adoption by 2025 is 25% for public transport and last-mile delivery. In our view, the drivers for EV adoption in NCT of Delhi vis-à-vis Mumbai are not one to one comparable, which can be seen from past policy and adoption of CNG for both these regions. During the month, MGL has signed a joint venture agreement with Baidyanath LNG Private Limited for incorporating a joint venture company for undertaking the business of selling LNG, liquified natural gas, as fuel to LNG vehicles to continue our initiative in the area of environment, safety and CSR. MGL has been awarded the National Award for Excellence in CSR and Sustainability by showcasing its interventions in the category of best overall excellence in corporate social responsibility practices implemented through our partners, NGOs. With this, I conclude and would now like to open the floor for the questions. Thank you very much.

We will now begin the question-and-answer session. [Operator Instructions] The first question is from the line of Probal Sen from ICICI Securities.

I have 3 questions. Firstly, you mentioned about, of course, the major discussion point, which is the EV policy. Just to get my -- a little bit more clarity from Maharashtra Draft EV Policy advocates 10% of new registrations by '25 and 25% of EV conversion for public transport and delivery services. Is my understanding correct?

Yes, that is right. 10% of new vehicles by 2025 and public transport and aggregator is 25%. And for public, it is 25% by 2025. That was draft in 2021.

But nothing much has moved on adoption of that, right, sir, as of now?

Sorry, what was that question?

Has anything moved on adopting or implementation of this policy, sir, as of date?

The policy has mandated 4, 5 things all with a deadline of 2025. There was only one thing with a deadline of 2022, which the government could not achieve, so they deferred it. The '22 -- the only deliverable on '22 were all government vehicles in Mantralaya, government office, et cetera, have to be EV. That they were not successful in doing. So they deferred that one provision of the EV. All the other asks are due only in 2025.

Understood. Got it. Secondly, sir, with respect to the volume growth, obviously, the overall H1 growth obviously has been impacted by the fact that Q1 had a fairly low volume growth. This quarter, I believe MD sir mentioned about roughly around a 4% Y-o-Y growth. Now I know you don't like to do this on a quarterly basis. But based on the H1 numbers, can we draw some sense of what -- where we stand with respect to our overall guidance? We have consistently guided to somewhere around 5% to 6% growth targets on an annualized basis for our volumes. But does FY '24 look a little bit at risk, given what H1 performance has been from a volume perspective?

Well, the volume hit which we took in the last 2 years, mainly on account of pricing of CNG, pricing for our cost of gas, which we got, et cetera, the tide has turned. And what degrowth or 0 growth, which we are showing that in Q2, we have shown that, yes, now we are again back on the track of growth. But we still not have hit that 6% kind of a number yet. We're still seeing in the CNG segment, for example, commercial vehicle growth still has not taken up. Maybe the transporters are waiting for a little more time or maybe once some mindset has set in, sometimes it takes a bit of time to reverse it. It is only 6 months back that we started dropping the prices of CNG. And it is only since 1 or 2 months now that we have partnered aggressively with the OEs to promote these vehicles. So the impact will come slowly. And I won't say we are there right now, but yes, the trend is positive and all other things being equal, we are hoping to hit that rate maybe in 2, 3 quarters.

One last question, if I may, sir. If you can indulge me. The LNG sales JV with Baidyanath. Can we get some understanding of how the revenue partnership would work, how the earnings model would work for the JV?

It's a 51-49 JV with Baidyanath LNG. So it's an incorporated joint venture company. And the same proportion of profit sharing will be done as per the equity holding.

[Operator Instructions] Our next question is from the line of Yogesh Patil from Dolat Capital.

First of all, congratulations on the good set of volume number, I think, sir, the volumes are at a record high level. Sir, I have a set of questions. The recently announced Delhi EV Policy Extension has also impacted the Mahanagar Gas stock price. So question is, how many Ola/Uber taxies are running on the roads inside the 3 GAs of Mahanagar Gas and how many or how much CNG do they consume on a daily basis? Can you give us some idea on that, sir?

That number, we can only guess because Ola/Uber themselves say that they have difficulty because the driver partners, they have downloaded both the apps. Sometimes they're sitting here, sometimes they're sitting there. So saying how many does Ola have, how many Uber has is difficult. But what best guess we have since we have is that maybe about 50,000, 55,000 of them may be plying on the road in our GAs on any given day. And their per capita consumption would be about 7 or 8 kgs. So whatever the resultant number is about 3.5 lakh, 4 lakh kgs out of the total 19 lakh, 20 lakh kgs we sell is from there.

And sir, could you please share the CNG volume consumption breakup of each category of vehicle, like the BEST buss, 3-wheelers, 4-wheelers, private car, 4-wheeler taxies? Just wanted a rough breakup on each category.

Again, to answer that, let me start with the caveat. We do not have data at that level of granularity because we don't get to capture and store sales at the dispenser for each vehicle against each category and stuff like that. So whatever, again, best estimates we have on the basis of a few surveys that we have done or some other secondary data is what I can share with you. There are about 4.4 lakh private passenger cars running on CNG and our estimate is they take about 30% of the roughly 19.5 lakh to 20 lakh kgs per day of CNG, which is sold. There are about 3.9 lakh auto rickshaws, which ply. And by our estimates, their contribution is about 30% or so. The cabs and aggregators, as I told you, it will be about 4 lakhs out of -- when I say cabs and aggregators, it is predominantly this Uber/Ola because the black and yellow fleet has really shrunk and not many of them are actually operating on the roads. If you look at the buses of the state transport undertakings BEST, MSRTC NMMT, et cetera, they represent about 7% of our volumes. They take roughly about 1.4 lakh kgs a day. The remaining is shared between the basically commercial goods segments, small, medium, large, et cetera.

Last question from my side. How many...

As mentioned, please take it with a pinch of salt because these are not very accurately measurable.

Yes, yes. So last question from my side. How many CNG vehicles added during the Q2 FY '24? And if possible, how many of them are LCVs or CVs numbers on your side?

Could you repeat your question, please?

So how many CNG vehicles added during the quarter second FY '24? And out of that, how many of them are LCVs and CVs?

Roughly 19,900 CNG vehicles are added during the quarter, okay? And -- you are saying out of that, how many LCVs? SCV-LCV is around 1,300.

So sir, frankly speaking, this number we have seen a jump. So last quarter, you have said close to 15,000 per quarter kind of CNG vehicle addition. Now it has gone up to the 19,000, 20,000 level. So have you seen the same kind of a jump in the LCVs, CV side...

I think there is an increase of around 100, 150 LCVs...

The majority of the increase would have come from the passenger car segment, where since the first, second week of September, we have started running these incentive schemes there. And the CNG volumes has increased from 2.481 MMSCMD to 2.583 MMSCMD, that is a jump of more than 4%. Q1 this year versus Q2, primarily because of the number of vehicles which are running, addition.

[Operator Instructions] Our next question is from the line of Niharika from Aequitas Investments.

So first question is regarding this Unison acquisition... [Technical Difficulty]

Sorry to interrupt, Ms. Niharika, you are not audible. May we request you to use your handset, please? Ms. Niharika, we are unable to hear you. May we request you to use your handset, please? Ma'am, your line is not clear. May we request you to rejoin the question queue in that case. Our next question is from the line of Sabri Hazarika from Emkay Global.

Two questions from my side. First is on -- I mean, we have seen that you've cut the prices and there's been some sort of like volume growth which has happened. So is it like -- is the Mumbai market showing some sort of like good price elasticity in terms of like CNG demand in particular?

Price elasticity for an INR 3 change is really difficult to measure. But what we are trying to do is we're trying to reverse the sentiment in the market. When in a span of 2 years, CNG went up from INR 49 a kg to INR 89 a kg. And since the last 8 months or so, we have been -- whenever we have got the opportunity, we are trying to reverse that trend. So we did a small drop in February, then in April, et cetera. So this time, I think we got an opportunity and our gas cost decreased because of the reduction on the HPHT price gap. And our margins anywhere are the healthiest ever in Q1. So basically to move consumer sentiment and to encourage an option of more CNG, we dropped that price by INR 3.

So sir, with this recent price cut to INR 76, are we at an INR 10, INR 11 sort of EBITDA per SCM? Any idea on that?

Some savings has come due to the reduction in HPHT ceiling from [ $12.12 to $9.96 ], okay. Also, consistently, we are getting HPHT gas for our balance requirement for priority sector over and above APM availability. APM availability has been constant, okay? So we feel that very little dependence, if at all on spot will be there for CNG as well as domestic PNG. And HPHT capped at $9.96 and APM available at $6.5, I think gas cost will remain very, very stable at least till this year-end, unless something happens on the foreign exchange side, okay? In view of that, we can say that, yes, our margin will remain and on an annual basis, as earlier, we have been riding INR 10 to INR 12 is an achievable target. This year, it could be little higher than that, having already achieved in the first half, almost INR 14.5 EBITDA per SCM.

Our next question is from the line of S. Ramesh from Nirmal Bang Equities.

So if you were to go back to this question about the concern on the EV penetration. I know we are all possibly grouping in the realm of what could happen in the future. But when you look at your overall target of 6% growth, if you take FY '25-'26, is a 6% volume growth achievable even if you see some progress in the EV conversion in your GAs? How do you see that?

See, the EV -- yes, the policies have been announced earlier also, and now also some targets that we announced in NCR. So one that the overall volumes are growing because of CNG conversions also, new vehicles are being added. We are launching new schemes to get more conversions. So the impact of that will also come. And there is a scope for market to grow for all the segments because overall, the health of roads are getting better in highways and other connected areas where the floating population of heavy commercial vehicles are also expected to pick up in next few years. So having said that, the impact of EV is not likely to be very significant as far as we are -- our analysis goes. Yes, it will have an impact after 7, 8 years or so when actual conversions of EVs take place. But there, again, the scope in existing vehicles which are running on diesel, to get converted into CNG is also going to happen pretty fast in next 3, 4 years' time. So our volumes are not actually in total danger. Maybe it'll get impacted if very aggressive conversion happens. But we expect that 5% to 6% growth of volumes to continue for next 5 to 6 years of time.

Okay. And second thing is the recovery in the industrial and commercial segment. Is it something which we can expect to continue for the next 2 quarters and the next couple of years? Is there a sustainable recovery there?

Well, if you look at our quarter-on-quarter basis, the number looks high, about 14%, 15% or something. But there is a reason for that. Q1, our industrial volumes are really actually low. They were lower than previous year also. The reason for that -- main reason for that was 2, 3 of our largest consumers happen to take a shutdown, maintenance shutdown in that quarter, which impacted our volumes. Now that depressed the base. And in Q2, we had upside in about 15,000, 16,000 SCMD from one existing customer who was using liquid fuel, whom we could persuade to switch to gas for the remaining requirement also. So if you look at our H1 versus H1, the increase is normal 5%, 6%. Having said that, I&C growth in the next 1 or 2 years, you may see slightly higher than what we have been doing in the past. This is mainly because we have tweaked our contracts to make them more user-friendly. We have done away with elements like take-or-pay, et cetera. We've given a lot of flexibility to customers. We're also giving them kind of 3-year 10% discount guarantee for new customers who are using a good amount of gas. Because of all these changes, we have signed up more than a lakh SCMD worth of contracts, which we will be connecting and commencing gas supply over the next few quarters. There will be an uptick in the I&C segment. Later on after that, with pipeline reaching a few more areas in Raigad, Raigad also industrial volumes will start contributing.

Okay. So if you were to just summarize your existing GAs in Raigad, just a clarification, you gave some numbers in terms of infrastructure addition. So the 319 CNG and the 32 CNG stations, are they separate numbers? Or should we read the 319, including the 32?

319, including 32.

Okay. And secondly, this 6% growth will include the ramp up in the volumes in Raigad also, right?

Yes, yes.

The next question is from the line of Varatharajan Sivasankaran from Antique Limited.

Just wanted to understand on the CV front. What is the promotional scheme which we are running as of now?

On what front, sorry?

CVs, commercial vehicles.

Well, we have basically segmented the commercial vehicle market into categories depending on the gross vehicle weight. For vehicles, which are more than 3.5 tonne weight up to about 10 tonnes, we are offering -- we are giving a fuel card, CNG fuel card worth about INR 2 lakh. Then if the gross vehicle weight is between 10 tonne and 15 tonne, we are giving INR 3.5 lakhs. If it is more than 15 tonne, we are giving INR 5 lakhs. This card can be used to buy CNG from our 319 stations. And since the per capita consumption of these vehicles is large, the higher the tonnage, the more kgs per day they take every day for their runs. We have calculated that we get an attractive payback. So initially, some 1 or 2 years of sales promotion expenses, we will get a longer run volume addition. And the other main condition is these vehicles need to be registered in RTOs, inside MGL's GAs. So it's not the case that some vehicle from Karnataka, Gujarat or Delhi comes here and takes that incentive and goes because whoever takes it has to fill it from a CNG station inside MGL's GA that is the limitation we've put on the card.

So this is a blanket scheme for all the existing vehicles as well? Or is it only for the new vehicles, which are getting registered?

It's only for new vehicles.

For heavier segments, we are allowing retrofit and new vehicles, both. And for passengers, we have...

For commercial goods vehicles, there are about 20-plus models in the market. I think we are doing incentives of almost all. And in the passenger car vehicle also, we are doing -- giving incentives worth INR 19,999. And this, we are only giving to select models of the top OEs. Because in CNG, there are some very, very high selling models, which have a wait time of 3 months, 4 months, et cetera. So they are anyway selling, so there's no need to incentivize them. So we have sat down together with 4 of the top OEs of passenger vehicles and we have identified which models we are going to promote. And the models were selected on the basis that their base sale is not really good, but given a nudge the potential for sales is high. So out of the 12 models of Maruti, which are on CNG out of the 14 total models, we have identified with them 7 models in which are in incentive. Hyundai, we identified a couple. And with other OEs also Tata and Mahindra, we are doing something.

When were these schemes started, sir?

It started from the -- progressively from about 7th or 8th of September, till the last one we signed up was probably in last week of September.

Okay. And how are you publicizing these things, sir? How does it reach the intended target customers?

There are joint advertisements by us and the OEMs like Maruti is putting a joint advertisement with MGL or Ashok Leyland is putting a joint advertisement with us, and they are advertising like that. Also, at the point of sale, the dealers' location also wide publicity is being given to them. As far as the retrofitment is concerned, all the retrofitters are taking sufficient measures to publicize it. In fact, the better way for the CV is to have the potential customer need, which Ashok Leyland and others have lined up and already done. We have done close to around 3 to 4 customer meets in which the potential -- the fleet owners are being invited to talk directly with the OEM as well as with MGL officials.

Just curious about this fact that you are also incentivizing retrofitting fitment. Given the fact that there is a wide variety of OEM vehicles available, is there any real requirement to address the retrofitment market?

We feel that retrofitment is also -- will add the potential -- add the vehicles because this market was almost coming to a standstill. And with this our scheme, it has given a fresh life, and what we have done this time is that we have gone through the retrofitment route through the kit manufacturer or distributor rather than going to the retrofitter directly so that the quality is maintained at the same time when the retrofitment is being done.

These vehicles will add on to the new sales. So retrofit is always an add-on to the existing OE models available. And there is an option, which is now available for existing vehicle owners to shift to CNG given the environmental benefits and running cheaper cost of running.

And as you know that beyond a certain number of years, the diesel vehicles are not allowed. So it is a win-win for the vehicle owner also that his life of the vehicle to ply within MMR region gets extended by 7 years.

[Operator Instructions] Our next question is from the line of Maulik Patel from Equirus.

A few questions. One, can you just give us the supply breakup and what's currently the cost of LNG, what was there in Q2?

CapEx, you're talking about CapEx?

Gas suppliers? How much of the APM you received and other long-term or the medium-term LNG contract you have?

Currently, if you look at our contracts, APM, we are getting around 2.7 MMSCMD and around 0.8 MMSCMD is through various term contracts, including Henry Hub, term contract and HPHT.

So hardly any spot LNG purchase you have?

Very negligible spot LNG, but let's say, if spot is cheaper than any of these term contracts, then we do have some ramp down in the existing term contracts. To that extent, we substitute spot for this term contract, if it is advantageous in terms of lower prices of spot. So last 2 quarters, at times, we have added spot whenever it was cheaper than either Henry Hub or cheaper than HPHT.

And in the last con call, you mentioned about that rich gas, which you guided, which essentially led to the lower MMSCM volume. And in the last con call, you gave the number of around 184 million kg was the number for CNG. What was the corresponding number for this quarter?

You're saying in terms of kgs, what is the MMSCMD that is what -- which is 1.9...

In CNG, what is your CNG volume?

Yes, yes. CNG in terms of kg is 1.897 for Q2, kgs per day -- million kgs per day. 1.897 is the number for Q2.

Per day, right?

Yes, Q1 was 1.838 million kgs per day.

Our next question is from the line of Niharika from Aequitas Investments.

So my question is regarding the Unison acquisition. So any update on that as we are already -- end of October going on?

Yes. The update is the term -- the 5-year lock-in was -- has expired on 25th of September. So Unison has applied to the regulator. Now there is some -- I mean, the Board meeting is yet to be hold for the PNGRB. So they will put up the proposal and once the proposing is cleared, so we expect that in the month of November, we should get the clearance from the regulator. And thereafter, we will get the acquisition.

Okay. So numbers should start flowing in our books from probably the last quarter of this financial year?

Probably Q3. Yes, if it happens in November, Q3 of this year.

Okay. And my next question is that we have reduced our prices by INR 3 in CNG and INR 2 by PNG and HPHT got reduced from INR 12 to INR 9. So have you passed on the full benefit? Or is it more than the benefit that we have passed on?

As we said earlier, I think it is a little more than the benefit of HPHT itself.

The numbers can be seen from EBITDA per SCM also. Our EBITDA per SCM has slightly come down from last quarter. So what we are also focusing at is to increase the volumes and therefore, we have reduced the prices slightly higher than what the benefit we were getting in the procurement cost.

Okay. And how much HPHT have you procured in Q2?

Q2 HPHT was around 0.3 MMSCMD.

0.28 roughly.

Roughly 0.28.

Okay. And on the card scheme, which you just mentioned, so how are we expensing the card expense? So as soon as the issue, is it coming in our P&L? Or is it like deferred whenever the card is swiped?

No, it will be based on the utilization by the person. So if you are getting a card and you are filling the gas, you will get a statement from the bank for card utilization. Based on that, it will be expensed out. However, it can be done on an estimated basis as well. So since we have just launched it in the end of Q2, we will wait and see. Both options are available with us.

So there'll be a slight jump in the sales promotion expense in the...

There will jump in the sales promotion expenses, yes.

Okay. And my last question is that I read an article which said that some 10,000 EV buses are going to get incorporated in Mumbai. So any -- so do you have any idea or any update on that front? Like are we -- is BEST or any other bus player is getting very aggressive on the EV front?

On the contrary, we heard that whatever commitments BEST had from the supplier that itself is not getting fulfilled. So I don't know, we are not...

Total buses running are hardly almost 3,000.

We have 480 EV buses. In the last 1 year, they have not managed to get more than 10 or 20 buses. There was also a news report today or yesterday, the Honorable Petroleum Minister, I think in some conference had made a statement saying that the government is coming up with -- giving a subsidy for some 10,000-odd buses across the country, but those -- that subsidiary will only go to smaller cities and towns, not to the metros because whatever subsidiaries are going to metros, that metros have taken. So the next tranche, this is a public announcement, which has been made is going to smaller towns and cities.

EV adoption of buses in Mumbai will be a slightly challenging job because of space constraint in Mumbai also. Right now, the charging happens in night and the buses run in the daytime. The range of electric vehicle buses is much lower as compared to CNG. Therefore, the chauffeurs having the same equal of movement of buses, they will require higher number of buses. Storage of that buses will not be available in Mumbai-like city. So that is another issue. Then charging point is another. Third is the availability of buses. Fourth is the cost, which is much higher. CapEx is required for procurement of electric vehicles. The supply side is still a constraint. So we expect these issues to be addressed. There is only the penetration of electric vehicles, especially in a city like Mumbai will have made any significant impact.