Gujarat State Petronet Limited (GSPL) is facing a significant corporate restructuring that has caught the attention of credit rating agencies. CARE Ratings has placed the company's long-term bank facilities rating of CARE AA+ on Rating Watch with Developing Implications, signaling potential changes in the company's credit profile.

Credit Rating Action

CARE Ratings has taken the following actions on GSPL's bank facilities:

RWD: Rating Watch with Developing Implications

Reasons for Rating Action

The rating action follows:

1. The proposed amalgamation with Gujarat Gas Limited (GGL)
2. The subsequent de-merger of the transmission business into separate entities
3. A review of GSPL's operational and financial performance

Restructuring Details

The company's total bank facilities of Rs 300 crore include:

• Reduced long-term facilities of Rs 50 crore
• Long-term/short-term facilities of Rs 250 crore

The restructuring is expected to be completed by January 2026.

Financial Performance

Despite the rating uncertainty, GSPL's financial position remains robust. Key financial metrics from the latest balance sheet data include:

Implications and Outlook

The Rating Watch status reflects the potential impact of the corporate restructuring on GSPL's credit profile. The amalgamation with Gujarat Gas Limited and the subsequent de-merger of the transmission business could significantly alter the company's operational and financial dynamics.

Investors and stakeholders should closely monitor further developments, as the final impact on GSPL's credit rating will depend on the execution of these corporate actions and their effect on the company's financial strength and business profile.

CARE Ratings is expected to resolve the Rating Watch once the implications of the restructuring become clearer, providing a more definitive view on GSPL's credit quality going forward.

Gujarat State Petronet Limited (GSPL) has announced a significant investment in its joint venture company, GSPL India Gasnet Limited (GIGL). The Board of Directors of GSPL approved two key financial commitments during a meeting held on November 11, 2025.

Investment Details

The approved investments include:

1. Subscription to GIGL's right issue of Redeemable Cumulative Preference Shares amounting to ₹35.77 crore.
2. An additional equity contribution in GIGL of up to ₹7.80 crore.

These investments bring GSPL's cumulative equity contribution in GIGL to ₹1,339.84 crore.

Shareholding Structure

GSPL currently holds a 52% stake in GIGL and will maintain this percentage after the additional equity contribution. The other joint venture partners in GIGL include:

• Indian Oil Corporation Limited (26%)
• Bharat Petroleum Corporation Limited (11%)
• Hindustan Petroleum Corporation Limited (11%)

GIGL's Operations

GIGL is engaged in the execution and implementation of cross-country natural gas transmission pipeline projects. The company is currently working on two major projects:

1. Mehsana-Bhatinda Pipeline Project
2. Bhatinda-Gurdaspur Pipeline Project

Both projects were awarded by the Petroleum and Natural Gas Regulatory Board.

Financial Assistance

In addition to the equity investment, GSPL has agreed to provide interim financial assistance to GIGL:

• An interest-bearing advance of ₹18 crore
• Interest rate: 7%
• Purpose: To support GIGL's operations until the issuance of preference shares

Impact on GSPL

This investment is expected to help GSPL serve customers beyond Gujarat and increase gas volumes transported through its gas grid. The company views this as a strategic move to expand its operational reach and enhance its market position in the natural gas transmission sector.

As the natural gas infrastructure continues to expand in India, GSPL's investment in GIGL underscores its commitment to strengthening its position in the growing market for natural gas transmission and distribution.