Yesterday, Mahanagar Gas, which supplies to Mumbai announced that it has increased the basic price of Compressed Natural Gas (CNG) by Rs 1.15 per kg and of domestic Pipelined Natural Gas (PNG) by Rs 0.95 per standard cubic meter (SCM) in the city.

This will escalate the cost of CNG by Rs 42.63 per kg and PNG by Rs 25.69 per SCM (slab 1) and Rs 31.29 per SCM (slab 2).

The company stated that this increase would have a marginal impact of Rs. 0.04/kilometer and Rs. 0.06/kilometer on per kilometer running costs of auto rickshaws and taxis respectively. In view of an increase in MGL’s gas purchase costs due to the recent increase in ‘Domestic Natural Gas (APM) Price’ by the Government of India from US$ 2.48 / MMBTU (GCV) to US$ 2.89 /MMBTU (GCV), MGL is constrained to increase the basic price of the fuel.

Naturally, a price hike means better margins for the company and the market is happy with this news. The stock price rose over 3% to Rs.1115.10. Its 52-week high and low stands at Rs.1184.95 and Rs.642.75 respectively.