IGL Hits 52-week High on Q3 Show; Likely Curbs on Pet Coke Bonus for Co

The Economic Times - - Smart - Market In­tel­li­gence

Mum­bai: Shares of In­draprastha Gas (IGL) touched their 52-week high on Thurs­day af­ter the com­pany re­ported a 37% jump in net profit for the third quar­ter ended De­cem­ber on higher sales vol­umes and re­al­i­sa­tions.

An­a­lysts said the pos­si­ble ban on fuel and pet coke in the Na­tional Capital Re­gion (NCR) would be an­other pos­i­tive for the com­pany. The stock could see fur­ther up­sides in the com­ing months

IGL shares rose up to 4.8% to ₹ 1,026 on Thurs­day, its high­est in­tra-day in­crease since De­cem­ber 15 last year. The com­pany, which is the sole sup­plier of Piped Nat­u­ral Gas (PNG) and Com­pressed Nat­u­ral Gas (CNG) in the NCR, re­ported bet­ter than ex­pected in­crease in sales vol­umes buoyed by the reg­u­la­tory push for CNG in­stead of petrol for ve­hi­cles. Three price cuts in nat­u­ral gas in the last year by the cen­tral gov­ern­ment trans­lated into price cuts by the com­pany which led to an in­crease in over­all sales.

Yet an­other reg­u­la­tory push that could work in favour of the com­pany is the re­cent di­rec­tive by the Supreme Court to check the use of fuel oil and pet coke in in­dus­trial fur­naces. The court has di­rected liq­ue­fied nat­u­ral gas and elec­tric­ity to be used as al­ter­na­tives. The En­vi­ron­ment Pol­lu­tion Con­trol Au­thor­ity (EPCA) had es­ti­mated 30,000 MT of fuel oil be­ing sold monthly in NCR which would be re­placed by LNG and elec­tric­ity if the ban comes into place.

“The to­tal ban in fuel oil and pet­coke could trans­late an­nu­ally into a 3-4% growth for IGL” said Sabri Hazarika, an­a­lyst at Phillip Capital. HIGHS & LOWS

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