MGL_Allocation_Reduction.pdf (440.4 KB)
Allocation to the Company for CNG (Transport) has been reduced by ~20%, effective October 16, 2024,
compared to previous average quarterly APM allocation. This being major reduction in allocation, will have
an adverse impact on the profitability of the Company.
What possible outcomes shall be expected?
In my view,
- MGL has to manage sourcing the natural gas through different medium and pass on the cost to consumers. will the demand be the same if the price is hiked.
- MGL has to manage sourcing the natural gas & absorb the cost impacts, which leads to reduction margin eventually.
but does this change the demand for PNG & CNG over the long run?
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