Adani Gas surges 14% as stock shifts to normal trading segment

The stock surged 14% to Rs 88.70, its highest level since listing on November 5, 2018, on the back of heavy volumes on the BSE.

Shares of Adani Gas have surged 14% to Rs 88.70 per share, their highest level since listing earlier this month, on the back of heavy volumes on the BSE after the stock shifted to normal trading segment with effect from today from the restricted segment.

Adani Gas Ltd, the gas distribution arm of the Adani Group, made its stock exchange debut on November 5, 2018. The stock was admitted to the 'T' group of securities on the exchange with 5% circuit filter. In the trade-for-trade category, no speculative trading is allowed and delivery of shares and payment of consideration amount are mandatory.

“The trading members of the exchange are hereby informed that the price band of Adani Gas has been revised to 20% from 5% with effect from November 20, 2018,” BSE said in a notice dated November 19.

As part of the listing process, Adani Gas had allotted equity shares to existing shareholders of Adani Enterprises at 1:1 ratio. Following the listing, the Adani Group owners hold 74.92% stake in Adani Gas whereas retail and institutional investors will hold 3.36% and 21.72% respectively.

Adani Gas is developing city gas distribution (CGD) networks to supply the piped natural gas (PNG) to the industrial, commercial, domestic (residential) and compressed natural gas (CNG) to the transport sector. The company won rights to develop the distribution infrastructure for 13 regions by itself in the recent auctions. Its joint venture with Indian Oil will develop another nine areas.

“To leverage India’s rapidly growing gas market; Adani Gas has planned to invest over Rs 80 billion in the next 5 years to consolidate its position as the largest private company in the sector. It is noteworthy that India’s current CGD consumption is about 15-18% of domestic gas production and even at peak demand, consumption will be around 25-30%,” Adani Gas said in a press release.

Adani Gas, GAIL Gas and Bharat Gas Resources (a subsidiary of BPCL) will invest Rs 34 billion in creating CGD network in Odisha in the next eight years in seven geographical areas (GA) covering 17 districts, the Business Standard reported. CLICK HERE TO READ FULL REPORT

At 09:59 am; Adani Gas was trading 9% higher at Rs 85 on the BSE, as compared to 0.20% decline in the S&P BSE Sensex. The trading volumes on the counter more than doubled with a combined 2.3 million equity shares changed hands on the BSE and NSE so far.