ICRA notes that the sales volumes of the company across all segments barring PNG (domestic) have been adversely impacted due to the Covid-19 pandemic. However, with the easing of lockdowns volumes across most segments (barring commercial) have largely recovered and the company expects the impact on aggregate volumes in FY2021 to be less than 10% of its FY2019 volumes.
I heard few days back speculation of the same, finally itās here.
Itās definately bad for the ONGC/IOCL.
Thanks to the valuepickr community I stayed away from such PSUās.
Itās mentioned in the same article that it will lead to lower piped natural gas prices.
From experience what I have seen is that IGL do have a pricing power and does increases the price when the Natural gas price increases and also enjoys the benefit when the prices lowers.
Eventually I believe IGL will slash their prices too, but how much would that happens is what would drive the extra margin for IGL.
This April when the Natural gas prices were cut by steeping 26% IGL reduced the price by not more than 10%.
The bigger picture is this makes Natural gas more economical compared & attractive bet after the April 26% cut and now October 25% cut(NB: price changed only twice a year)
Disclosure: Invested
IGL, MGL & GUJARAT GAS all up 10%, hits upper circuit, seems something structural changed in the gas industry, unable to figure out what.
Anyone aware of such change?
I am looking at stocks, which are reasonably cheap to buy when markets are soaring new highs daily. I have come across IGL scrip - growth and profit seems to be good until COVID stuck the world.
There are multiple sectors like Retail - Apparel, Real estate etc which got affected badly by COVID. However, most of the stocks participated in bull market as people believed that once lockdowns are eased, these businesses will run with full capacity. I would like to understand why IGL stock price is not moving. Are there any other reasons than COVID? How is the future growth for this company ?
Considering the ask is to source 5% of vehicles as EV, surprising that this is specifically called out as a major threat to IGL. 5% of new vehicles should dent the revenue for IGL but is that seriously such a big threat?
IGL will benefit from the oil price rise (as CNG is alternate fuel to oil).
But IGL margins will shrink due to Gas price rise in international markets.
Gas price will likely rise or remain elevated with rising oil price.
Looks like the price of this stock has been flat for the last 3.5 years. Sales have tripled since then. However the margins have been lower because of material costs and other costs. If the costs reduce, this stock should return to its median PE at least. Median PE = 27.6, PE = 23.9