IGL shares surge nearly 8% on bourses
Feb 03 2014 , Mumbai
IGL's stock surged 7.74 per cent to settle at Rs 266.70 on the BSE. During the day, the scrip gained 11.49 per cent to Rs 276.
At the NSE, the stock rose by 7.43 per cent to end the trade at Rs 266.10.
"CNG and PNG prices will be cut. Also allocation of gas from domestic fields to city gas entities has been increased to 100 per cent from the current 80 per cent. This led to spike in IGL stock," Ashika Stock Brokers Research Head Paras Bothra said.
The government's move will lead to a steep Rs 15 per kg cut in CNG prices and Rs 5 in piped cooking gas.
Oil Minister M Veerappa Moily said government has now decided to meet all the requirements of CNG and piped cooking gas retailers in the country from domestic fields, sparing them the need to buy costlier LNG (liquefied natural gas).
Prices of CNG, or compressed natural gas, in the national capital had been hiked by Rs 4.50 last month to Rs 50.10 a kg after retailers such as Indraprastha Gas Ltd (IGL) were forced to buy a fifth of their gas (LNG) requirements from overseas.
With all the input fuel available at USD 4.2 per million British thermal units as against imported LNG, which is three times costlier, "the price of CNG in Delhi would be reduced by about Rs 15 per kg (about 30 per cent). There will also be a reduction of about Rs 5 per cubic meter (about 20 per cent) in the price of PNG," Moily said.
Moily said allocation of gas from domestic fields to city gas entities has been increased to 100 per cent from the current limit of 80 per cent.