In a volatile oil scenario, city gas distribution firms still a safe bet

Lower LNG prices, strong demand and geographical expansion to drive prospects for these gas companies

City gas distribution or CGD companies like Indraprastha Gas (IGL) and Gujarat Gas, which scaled to their 52-week highs in June itself, have accrued good returns for investors. While Mahanagar Gas (MGL) may have lagged, analysts feel all three companies remain a good bet for investors.

Their confidence stems from the fact that a strong gas demand is driving volume growth, while lower liquefied natural gas (LNG) prices too, bode well for the profitability of these players. Their March quarter performance also speaks for them. While IGL led in terms of volume growth of 17 per cent, Gujarat Gas recorded