Led by Indraprastha Gas,shares of gas companies today went into a tailspin,shedding up to 33 per cent,as oil regulator PNGRB slashed the network tariff and CNG compression charge IGL billed on sale of piped cooking gas to households and CNG to automobiles in National Capital.
Indraprastha Gas closed sharply lower by 33.3 per cent at Rs 231.20 on the National Stock Exchange. During the day,the stock tanked to a 52-week low of Rs 187.70,down 46 per cent.
At the BSE,the stock ended at Rs 229.80,down 33.66 per cent from the last closing price.
Among other gas utilities,GAIL India was down 2.24 per cent,Gujarat Gas plunged 14.61 per cent,Petronet LNG shed 3.03 per cent,and Gujarat State Petronet dropped 7.43 per cent.
“Gas utility stocks witnessed huge losses today as PNGRB slashed network tariff and compression charges for CNG,” Shanu Goel Research Analyst Bonanza Portfolio said.
“The recent order on tariff would keep the stock under pressure,” brokerage firm Emkay Global Financial Services said in a report.
CNI Research CMD Kishor Ostwal said,”Revision in prices has battered the stock. Profitability of IGL may decline by 40 per cent with similar impact on the stock price and a cut in earnings per share.”
PNGRB in an April 9 order fixed IGL’s pipeline network tariff at Rs 38.58 per million British thermal unit as against Rs 104.05 per mmBtu proposed by the company.
It also cut compression charge for CNG to Rs 2.75 per kg from Rs 6.66 per kg submitted by IGL.
PNGRB said the new charges would be applicable from April 1,2008.