Shares of GAIL shot up over 10% to close at Rs. 351. Commenting on the same, Amar Ambani, Head of Research, IIFL, said, “Media reports have cited that RasGas of Qatar and Petronet LNG are renegotiating contract for the long-term sourcing of LNG. The formula tweaking, if it happens, will bring down the price of long term LNG, which is currently 50% more expensive than spot LNG. GAIL would be a large beneficiary from this as majority its natural gas requirements of petrochemical division are met through long term LNG imports by Petronet LNG. The impact would be dependent on the actual contours of the revised agreement. Its pipeline business however remains at risk owing to low capacity utilization levels.”
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