Sunrise industry is a term for a burgeoning sector or business in its infancy showing promise of a rapid boom. Distribution of cooking gas is today one such industry. Gujarat Gas Limited is a prominent company in this sector. The company undertakes distribution of gas to household, commercial and industrial sectors.
The biggest distributor of cooking gas in India, Gujarat Gas Limited has presence in 23 cities of Gujarat, Thane and the Union Territory of Dadar and Nagar Haveli. The company has received the contract to distribute cooking gas in 17 cities across Punjab, Haryana, Madhya Pradesh and Rajasthan. With this, the company has grown to become a Pan-India company.
The company has 23,300-km gas pipeline network and 344 CNG stations as well. The company supplies cooking gas to 13.55 lakh houses. In the industrial sector it supplies CNG to 3,540 institutions.
Compared to three years ago, Gujarat Gas Limited has achieved 39 per cent growth in the daily distribution of gas. This was powered by the increased use of gas by manufacturers of ceramic tiles. With the Green Tribunal recommending the closure of coal plants, Morbi, the biggest centre of ceramic production, switched to the use of LPG.
Instead of the traditional LPG cylinders, the country is slowly switching to using LNG connections. This has strengthened the growth of companies in the cooking gas distribution sector in India.
This stock had shown promising performance in the stock index last year. Among the medium companies, Gujarat Gas Limited has put up a different performance. Investors can buy the shares of the company with a long-term outlook.
‘
Taking into account the growth potential of Gujarat Gas Limited there are possibilities of this share giving good returns in the long term. When the stock market crashed in March, the shares of the company tanked to Rs.201 but is now trading near Rs.300. It would be advisable to buy the share during the time of market correction.
