Impact Assessment of Gas Price Hike on Different Industries and Overall Gas Sector in India



Produced by: InfraInsights
Published:  September 20, 2013
Country:  India
Sector:  Energy
Pages: 80
Format: PDF


The Government of India recently doubled natural gas prices from the existing $4.2 MMBTU to $8.4-8.5 per MMBTU.  In order to assess the real impact of this gas price hike across industries and its effect in the times to come, InfraInsights is pleased to launch its latest research report focusing on the ramifications of the gas price increase.  This report will decode the policy announcement and its impact on gas producers, gas transmission companies, gas distributors, gas consumers, gas imports and the overall economy.


Table of Contents:


1. Gas Price Hike and its Premise: Comprehension of the Understanding the Rangarajan Committee Formula for gas pricing approved by CCEA

  • Gas Pricing mechanism
  • Recommendations of Rangarajan Committee
  • Gas prices have been kept low for strategic sectors such as Fertilizer, industrial consumers, etc. deterring further investment in the sector
  • What have we gained from low price and prioritizing sector? Why the price hike was essential now?
  • Comprehensive understanding of Rangarajan Committee formula for gas pricing approved by CCEA

2.     Quantifying Impact of Gas Price Hike on stakeholder across Gas Value Chain: Short term, Medium and Long term

  • Upstream/Gas Producer: ONGC, OIL, RIL and Others
  • Midstream/Gas Transmission Companies: GAIL
  • Downstream Companies: MGL, IGL and other CGD Companies
  • Analyzing financial implication on the revenues & cost of companies supplying/procuring gas
  • Improvement in EPS & likely de-rating/re-rating of stock prices of energy company linked directly or indirectly with gas

3.     Impact of Gas Price Hike on end user Industry:

  • Power Companies: Central, State Gencos, IPPs etc
  • Fertilizer Companies: RCF, Chambal, Coromandel
  • LPG & CNG Prices

4.     Impact of Gas Price Hike on end consumers:

  • Quantum of hike in Power Tariff across discoms
  • Quantum of hike likely for CNG & LPG consumer
  • Quantum of hike likely to be seen in Fertilizer Industry

5.     Gas subsidy bill trajectory if Power and Fertilizer industry is to be insulated to some extent: 2017 and 2025

6.     Impact of Gas Price Hike on Gas Infrastructure in India

  • Assessing long-term economic feasibility of LNG & FSRU Industry
  • Will it fuel investment in gas transmission infrastructure and CGDs?
  • What it means for CBM and other alternatives fuel

7.     What this Gas price hike means for the overall economy? And will it lead to turn around of gas sector in India?

8.     InfraInsights Viewpoint:

  • Attractiveness of imported gas vis-a-vis domestic gas in immediate short to medium to long term
  • Will the investment in Gas exploration increase post the hike
  • Competitiveness of Indian Industry that depends on gas post the gas price hike

9.     Voice of Industry/Sentiment Analysis: View point of industry leaders on gas price hike and its positive/negative across different industry both in India and outside India


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