Domestic gas prices are set to be hiked from April 1 (Friday) and the market expects a steep increase, with some predicting a more than doubling of rates. The rate hike is a part of the six-month revision process undertaken by the government.
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Expectations
CLSA expects prices to shoot up by almost 120 percent, which will be more than double the $7/mmBtu mark. Jefferies has put out a note where they expect a price hike to around $6.60/MMBtu.
Impact on listed players
All this is positive for gas producers like Oil India, ONGC, HOEC etc. but it will be negative for city gas distribution companies, fertilisers and ceramic companies.
City gas distribution companies have already taken some price hikes because of the higher spot LNG prices but some more is likely in store.
Watch the accompanying video of CNBC-TV18’s Sonal Bhutra for more details.
