IGL's Smart Response to Delhi's EV Push Could Set the Playbook for India's CGD Sector

DELHI, India - July 5, 2025 - PRLog -- As Delhi unveils its Electric Vehicle Policy 2.0, mandating a sharp phaseout of CNG three-wheelers and restricting new CNG vehicle registrations, all eyes are on Indraprastha Gas Ltd (IGL). The company's operational strategy, financial positioning, and regional diversification now serve as a litmus test for how City Gas Distribution (CGD) companies can weather the accelerating electric mobility transition.

From August 15, 2025, Delhi will halt new registrations of CNG autorickshaws and two-wheelers. While this signals a significant policy pivot, the financial impact on IGL is limited. According to current projections, even if all CNG three-wheelers in Delhi convert to electric, CNG volumes would decline by just 2.3% by FY27. Impact on EBITDA is estimated at –2.5%, and EPS at –5.8%.

This measured exposure is already built into IGL's planning model. CNG volumes are still projected to grow from 6.6 mmscmd in FY25 to 8.0 mmscmd in FY27, with a CAGR of ~10%. Notably, only half of IGL's CNG sales come from Delhi. New geographical areas (GAs) in Rajasthan, UP, and Haryana, currently outside stringent EV regulations, offer growth insulation.

Investor confidence is further reinforced by IGL's strong metrics: rising EBITDA margins (from INR 6/scm to 6.5/scm), stable ROE (~17.5%), and a net cash position. Even past gas cost shocks—due to lower APM allocation—were swiftly mitigated through pricing action and improved sourcing, restoring margins in Q4FY25.

The company is also investing for the future. A 500 MW solar venture with RVUNL, LNG station rollouts in Rajasthan, and targeted investments in CBG reflect a clear pivot toward diversification. Joint venture MNGL is also showing stellar performance with a 15% projected volume CAGR and industry-leading EBITDA/scm.

Despite regulatory headwinds, CNG vehicle registrations rose 17% YoY in Q1FY26 across IGL's GAs—underscoring continued consumer confidence in clean gas mobility.

Conclusion:
IGL's response to Delhi's EV pivot is not just about damage control—it's about future-proofing the CGD business model. With resilient demand, strategic foresight, and expansion into renewables and alternative fuels, IGL offers a potential roadmap for other CGD players across India.

Visit: https://www.indianpetroplus.com/ for full insights and sector updates.
Media Contact:
editorial@indianpetroplus.com | +91-9810156957