Shares of GAIL (India) Ltd. and Gujarat State Petronet Ltd. jumped after the regulator Petroleum & Natural Gas Regulatory Board increased tariffs for some pipelines
The tariffs were hiked in the range of 27 percent to 691 percent for nearly six pipelines in India, according to a notification on the regulator’s website. The new prices will be applicable from April 1, 2018.
Brokerages said the hike will boost earnings per share of GAIL and Gujarat State Petronet by 6-19 percent. Shares of GAIL rose as much as 4 percent — the most in over a month — GSPL jumped up to 7.6 percent, the most in three months.
This increase in pipeline tariffs is expected to boost Gujarat State Petronet’s net profit by Rs 180-200 crore, T Natrajan, the managing director of the company, said in an interview to BloombergQuint. While it would increase the cost of gas for consumers, he expects the demand to remain unaffected.