Maharashtra government reduces VAT on CNG & PNG

News: Maharashtra government, in its budget session, announced that VAT on CNG & PNG will reduce from 13.5% to 3%.

Views: This will mainly benefit Mahanagar Gas in our coverage universe. If the company pass on the benefit to customers, it will further increase CNG's discount to petrol & diesel leading to higher conversion. If prices are maintained, it will give headroom to MGL in terms of margins if gas procurement costs increase further.

Impact:Positive