Shares of GAIL (India) Limited surged over 6% to ₹185.66 in Monday’s trade after the Petroleum and Natural Gas Regulatory Board (PNGRB) initiated the process to amend the Natural Gas Pipeline Tariff Regulations, 2008. The move comes after the board received requests and suggestions from the Industry Committee regarding the tariff framework.
PNGRB has now invited public comments on the proposed amendments by April 11. These changes aim to bring more flexibility in tariff structures through updated cost pass-through mechanisms and volume-based assumptions. If finalized by June 2025, the reforms could lead to higher transmission tariffs, directly benefiting major gas transmission players like GAIL and GSPL.
According to CLSA, the proposed tariff structure could act as a catalyst for transmission companies, enabling better margins and revenue visibility. The reforms are also expected to boost natural gas adoption in India from 6% to 15% of the energy mix.
However, the brokerage also noted that while the move may slightly increase input costs for certain industrial users like Gujarat Gas, it could lower opex for city gas distributors such as Indraprastha Gas and Mahanagar Gas.
GAIL, with a market cap of ₹1.22 trillion, is among the largest gas transmission firms in the country and stands to gain significantly from these regulatory changes.
