CNG Price Hike: Indraprastha Gas Limited (IGL) has announced a hike in the prices of Compressed Natural Gas (CNG). Shares of Indraprastha Gas Limited will be in focus on Monday (April 7).
The natural gas distribution company has announced a hike in the price of Compressed Natural Gas (CNG) by Rs 1 to Rs 3 per kg. In the capital Delhi, its prices have been increased by ₹ 1 per kg, while in other cities the increase is Rs 3 per kg.
Indraprastha Gas Limited (IGL) stock is expected to be in a good shape on Monday, April 7, as the company has announced to sell Compressed Unit Gas (CNG) at Rs 1 to Rs 3 per lakh. The price in Delhi is ₹ 1 per kg, while in others it is ₹ 3 per kg. This is the first time CNG prices have increased in the Delhi market since June 2024.
Delhi accounts for 70% of IGL’s total CNG sales, while the remaining 30% comes from other markets. After the price hike, the price of CNG in Delhi has now reached ₹ 76.09 per kg. While in Noida and Ghaziabad it is ₹ 84.70 per kg. In November 2024, IGL had increased the price for markets other than Delhi.
Brokerage firm Jefferies had said in a February note on IGL that a price hike of Rs 2 per kg would be sufficient to maintain current margin levels. The price revision comes soon after the government announced a 4% hike in gas prices under the Administered Price Mechanism (APM).
APM gas prices have been fixed at $6.75 per mmBtu for the period April to September this year. Prices remained stable at $6.5 per mmBtu in the first three months of the year. This is the first increase in the price of APM gas since April 2023. This is in line with the recommendations made by the Kirit Parikh panel.
As per the panel’s recommendations, there was a provision for a 4% hike in gas prices from the third year of implementation, which was implemented from April 2023. It remains to be seen how big names like IGL and MGL react to the price hike. As of last Friday’s close, IGL shares were still down 30% from their peak. While MGL shares were down 33%.
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