Gas Distribution Stocks: List of Gas Distribution Shares in India

About the Gas Distribution Sector

The Gas Distribution or the City Gas Distribution (CGD) sector in India refers to the network of companies responsible for distributing Piped Natural Gas (PNG) and Compressed Natural Gas (CNG) to households, industrial units, and commercial establishments across the country. CNG is primarily used as auto-fuel, and PNG is used in domestic, commercial and industrial segments.

In the last few years, the PNG connections in India have grown significantly. As per the Ministry of Petroleum and Natural Gas, in 2021, the number of PNG connections in India was approximately 9.3 million, which has grown from 7.9 million in 2020.

Future Outlook of the Gas Distribution Sector in India

The Indian Government’s measures to increase the usage of natural gas for cooking to help reduce the number of people who suffer from health issues from the release of fossil fuels such as coal, cow dung or wood will result in a boost in PNG connections over time. The Government’s intention to convert India into a gas-based economy is expected to raise the natural gas share in its energy mix from 6% in 2019 to 15% by 2030. This is anticipated to create huge opportunities for India’s CGD market.

Things To Consider Before Investing in the Gas Distribution Sector

Regulatory Environment: Evaluate the regulatory landscape governing gas distribution. Keep yourself updated on the government policies related to the gas sector. Policies can influence pricing, subsidies, and overall market dynamics.
Market demand: Understand the current and anticipated demand for gas in the target market. Stay informed about industry trends and emerging technologies. Also, assess the existing infrastructure and expansion plans of the gas distribution companies. Consider their capacity to meet growing demand.
Environmental conditions: Given the nature of the gas industry, adherence to environmental and safety standards is crucial. Evaluate companies’ commitment to these standards.

How To Invest in Gas Distribution Sector Stocks?

Investing in gas distribution stocks via Angel One is easy. Simply follow these steps:

Log in to your Angel One account.
Click on the search icon and look for your desired gas distribution sector stock.
Now, place your buy order. Simply click on the ‘Buy’ button, enter your desired quantity, and select the order type.
To complete your transaction, click on the ‘Buy’ button.

If you don’t have a Demat account with Angel One, you can open one for free online within minutes.

FAQs

What are gas distribution sector stocks?

Gas Distribution sector stocks are stocks of companies that are involved in the distribution of PNG and CNG across the country to different segments of customers, such as households, industrial units, and commercial establishments.

What are the top stocks from the gas distribution sector in terms of market cap?

Based on the market cap, Adani Total Gas Ltd, GAIL (India) Ltd, Gujarat Gas Ltd, and Indraprastha Gas Ltd are the top gas distribution stocks in India. The data is as of January 30, 2024.

How do you evaluate gas distribution sector stocks?

While analysing the gas distribution sector stocks, you must check certain factors like the services offered by the company, competition, regulatory compliance, safety and environmental practices and financial health.

Why should you invest in gas distribution stocks?

The growing demand for cleaner fuels like natural gas, especially in India’s expanding pipeline gas network, can create opportunities for companies involved in the sectors. However, consider your investment objectives and risk appetite before investing.