Delhi EV Policy 2.0 Triggers Over 4% Fall in IGL Share Price

Indraprastha Gas Limited (IGL) shares took a sharp hit of over 4% in Tuesday’s trading session after the Delhi government unveiled the draft of its Electric Vehicle (EV) Policy 2.0. The policy proposes a gradual phase-out of petrol, diesel, and even CNG-powered vehicles, causing investor concerns over IGL’s future business prospects.

No More New CNG Autos

One of the most notable moves in the draft is the decision to stop the registration of new CNG auto rickshaws from August 15, 2024. Instead, all permits will either be substituted or re-issued as electric auto rickshaw permits, aiming to reduce vehicular emissions in the national capital.

This significant policy shift directly affects IGL’s core customer base, as the company is a major supplier of CNG for public transport in Delhi.

Other Vehicles Also Affected

The policy does not stop at autos. It proposes that CNG autos over 10 years old must be either converted or replaced with battery-powered models during the policy period. Diesel, petrol, and CNG goods carriers also face a ban on new registrations from 15 August 2024.

Further down the line, the policy plans to ban two-wheelers running on petrol, diesel, or CNG from 15 August 2026. This reflects a bigger push to reduce pollution by promoting clean energy vehicles across the city.

Changes in Public Transport

The Delhi government also wants all buses run by DTC and DIMTS to be electric. Only electric buses will be allowed for city travel, while BS VI buses will be permitted for inter-state routes.

Even private car owners will be affected. The draft recommends that anyone with two or more cars should only be allowed to buy electric cars once the policy comes into effect.

Implications for IGL

Given that a significant portion of IGL’s revenue comes from supplying CNG to autos, buses, and goods carriers, the announcement has raised concerns about its future growth trajectory. Investors reacted swiftly, with IGL share price closing at ₹180.16 on Tuesday, marking a dip of over 4%.

Although the transition to EVs is expected to take place over several years, the policy clearly signals that CNG will not be a long-term solution in Delhi’s green mobility plans.

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