CNG vehicle registrations surge despite price hikes, says Dolat Capital

• ANI

• Published On Jun 10, 2026 at 06:06 PM IST

CNG vehicle registrations and Morbi industrial gas consumption are both tracking strong growth into mid-2026, Dolat Capital said in a research report.

Despite multiple CNG price hikes, total cost of ownership for CNG vehicles remains 17 per cent lower than EVs in Delhi and 16 per cent lower in Mumbai for the same vehicle. Payback vs petrol has stretched by only 2 months in both cities, keeping economics favorable. For Gujarat Gas, spot LNG blending is expected to rise further as Morbi demand surges, while PNG(I) trust and assured supply continue to beat propane despite near-equal pricing.

CNG adoption stayed strong in May 2026 across 3W+4W categories, supported by robust auto sales. Registrations rose 35 per cent YoY at both IGL at 14.8k/month and Gujarat Gas at 13.2k/month. Mahanagar Gas Limited saw registrations at 7.5k/month, down 6 per cent YoY, but adoption rates remain high at 34 per cent for MAHGL, 35 per cent for Gujarat Gas and 31 per cent for IGL. Dolat Capital projects the next 12 months’ CNG volume growth at 15 per cent for Gujarat Gas, 8 per cent for Mahanagar Gas and 9 per cent for IGL.

In Morbi, PNG(I) volume has surged to 8.2 mmscmd month-to-date in June 2026, up 15 per cent MoM as 800 of 850 ceramic units have resumed operations. Channel checks indicate the remaining units will be operational next week, taking consumption to 8.5 mmscmd. That would mark an all-time high and over 3x YoY growth in PNG(I), likely pushing overall Gujarat Gas volume above 14 mmscmd. PNG(I) Q1FY27E volume is pegged at 5.7 mmscmd, up 115 per cent YoY and 154 per cent QoQ.

Pricing dynamics favor PNG(I) despite parity. PNG(I) is priced at ₹84/scm for CV 8,350 vs propane at ₹108/scm for CV 11,000 on landed basis. Morbi industries are sticking with PNG(I) for trust and assured supply, with a switch only likely if propane gets ₹10/scm cheaper. Morbi ceramic consumers without LPG receiving units get PNG(I) at ₹8/scm less due to loyalty benefits.

Tile prices have risen ₹10/sq ft to ₹32/sq ft vs ₹22/sq ft pre-war, driven by higher gas, coal, freight and diesel costs. Domestic demand is at peak levels with 45-day order books and 20-day waits for bulk buyers. Gujarat Gas sales mix now has 55 per cent spot LNG, and the share is expected to rise further as Morbi volume climbs.