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MGL Share Price in Focus as BMC Directs Eateries to Switch to Clean Fuel

Written by: Team Angel OneUpdated on: Feb 18, 2025, 3:38 PM IST
MGL shares gain after BMC orders eateries, hotels, and vendors to switch to eco-friendly fuel by July 8, aligning with pollution control measures.
MGL Share Price in Focus as BMC Directs Eateries to Switch to Clean Fuel
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Mahanagar Gas Limited (MGL) holds a dominant position in the gas distribution sector in Greater Mumbai. The company primarily thrives on its compressed natural gas (CNG) business, which forms the bulk of its revenue. Additionally, MGL supplies piped natural gas (PNG) to industrial, commercial, and residential consumers, expanding its footprint in the clean energy sector.

BMC’s Directive to Switch to Clean Fuel

In a significant development, the Brihanmumbai Municipal Corporation (BMC) has mandated that all eateries, bakeries, hotels, and roadside vendors transition to clean, natural, and eco-friendly fuel sources by July 8, 2025. This directive follows Mumbai’s consistent struggle with deteriorating air quality, especially post-monsoon in October 2024.

The move also aligns with the Bombay High Court’s (HC) order from January 9, which granted a 6-month period for commercial establishments to make the switch. The civic body has made it clear that strict action will be taken against those failing to comply with the new guidelines.

Impact on Businesses and Pollution Control Measures

According to the BMC, burning wood and coal releases hazardous emissions that worsen air quality and contribute to an increase in respiratory illnesses. The directive is aimed at reducing these emissions and promoting the use of cleaner alternatives like CNG and PNG.

Civic officials estimate that bakeries alone contribute nearly 6% of Mumbai’s total pollution, and over the past six months, 29 bakeries have already transitioned to using natural fuel. The new regulation is expected to accelerate this shift, impacting a large number of businesses across the city.

MGL Poised to Benefit from Increased PNG Adoption

As commercial establishments move towards CNG and PNG, MGL stands to benefit from increased demand. The directive could drive higher consumption of PNG, reinforcing MGL’s position as the leading gas distributor in Mumbai.

Reflecting the positive sentiment, MGL’s share price rose by 0.88% as of 9:53 AM on February 18, 2025. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Published on: Feb 18, 2025, 3:38 PM IST

Team Angel One

Team Angel One is a group of experienced financial writers that deliver insightful articles on the stock market, IPO, economy, personal finance, commodities and related categories.

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