NGT has ordered all ceramic units at Morbi to either shift to natural gas or shut down. While Morbi volumes (2.5 million standard cubic feet per day; 40% of GGAS vol) have been witnessing softer trends of late, any gain in market share triggered by curb on polluting substitute fuels can have a major positive impact since 3 mmscmd of units are connected with Gujarat Gas Morbi units use other fuels (coal gasifier). With margin recovery also in sight and valuations at 15x FY20E P/E, we keep our ‘BUY’.
The National Green Tribunal (NGT) has ordered the shutdown of all ceramic units running on coal gasifier (mainly unorganised sector) unless they shift to natural gas. This order comes after a petition filed by a resident against industrial pollution.
