IGL is cooking well!

Indraprastha Gas is doing very well today morning. The stock which had closed yesterday at Rs.265.95, opened at Rs.275 and it currently remains around the same levels. Volumes are up almost 3 times.

The stock is up as the company, which is the sole CNG and PNG retailer in Delhi, hiked price of CNG by a steep Rs.4.50/kg. The price of cooking gas has also been hiked and that is steeper – Rs.50.10/kg in Delhi and Rs.56.70/kg in Noida, Greater Noida and Ghaziabad. This price hike will be effective from midnight tonight.

This price hike comes after its around 2.5 months and the company has stated that it hiked prices die to increase in input cost. There has been a reduction in allocation of APM gas to IGL, forcing it to source more quantity of market priced imported R-LNG, whose prices are currently on an upswing.  This affected its overall input cost by over 13%. The hike in minimum wages by the Govt has also led to an increase in its operating costs. The market is happy because this would now mean that the company has taken steps to protect its margins.