The liquid petroleum gas (LPG) shortage is making a dent across the hospitality and restaurant segments, with many small-time food joints on the verge of temporary shutdown. The government has temporarily prioritised cooking gas cylinder supplies to some key sectors such as education and hospitals. This brings a spectrum of stocks under focus that are directly related to the news.
Key stocks to watch amid LPG shortage
Food delivery apps like Eternal and Swiggy are being directly impacted, and shares of both have been on a losing streak for the past two sessions.
Furthermore, GAIL (India), Indraprastha Gas, Hindustan Petroleum Corporation, Bharat Petroleum Corporation, Reliance Industries, Oil And Natural Gas Corporation, and many other gas stocks continue to be on the investor’s radar in Thursday’s trade.
The other big space to watch is the electric induction stove market. Induction oven makers like TTK Prestige, Stove Kraft rallied in trade on Wednesday and continue to be in focus on Thursday too, as the situation escalates in the Strait of Hormuz area.
What has the government said on this?
However, Ministry of Petroleum and Natural Gas’ Joint Secretary Sujata Sharma gave assurance that domestic LPG cylinders will be delivered within nearly 2.5 days of booking and that the government has carried a major chunk of the cost increase. The inter-booking gap has been widened from 21 to 25 days as a demand management measure.
Also, the oil ministry has constituted a three-member committee that comprises Oil Marketing Companies’ (OMC) executive directors to review requests for LPG supply from restaurants and hotels. and other non-domestic sectors.
The government has asked refineries to raise LPG production. Authorities have also directed OMCs to prioritise domestic LPG connections over commercial users, emphasising that household consumers will remain the top priority.
Reliance Industries will maximise LPG production
Reliance Industries said it is taking steps to maximise LPG production from its refinery at Jamnagar. The company said that it will divert natural gas supply to key sectors.
The refiner said, in an exchange filing, that natural gas produced from the KG-D6 Basin will be diverted to support supply to priority sectors, in line with national energy priorities and government guidelines.
“Reliance Industries is taking proactive steps and, in line with the government guidelines, to maximise LPG production from our refining and petrochemicals complexes at Jamnagar, the world’s largest integrated refining hub. Our teams are working around the clock to optimise refinery operations and enhance LPG output so that supplies to the domestic market remain stable and reliable,” the company said.
PM Modi on asks to remain calm amid LPG shortage
Prime Minister Narendra Modi appealed to the citizens not to panic over the LPG shortage triggered by the ongoing tensions in West Asia, and assured that the government will safeguard public interests.
The Prime Minister said the conflict has disrupted global energy supply chains, leading to challenges in the availability of commercial LPG cylinders that are widely used by hotels and restaurants across the country.