Gas regulatory issues notice to Adani Gas; seeks to cancel license

The shares of Adani Gas tumbled on Friday following a notice by Petroleum and Natural Gas Regulatory Board of India (PNGRB) for failing to disclose crucial information and breaching regulations in the bidding process for City Gas Distribution (CGD) projects.  

According to reports, PNGRB alleged that Adani Gas bids for projects using net worth calculations of Adani Enterprises without disclosing the scheme of arrangement between the two companies.

Notably, Adani Gas demerged from its holding company, Adani Enterprises, as a part of restructuring, however, PNGRB stated that Adani Gas’ shareholding and restructuring were not in compliance with CGD regulations, resulting in the violation of law. As a result of this, PNGRB is seeking to cancel the license of Adani Gas and levy a penalty of Rs 400 crore for the violations.

Meanwhile, Adani Gas commented that it had responded to the regulatory board and provided all the information to close the matter.

At 12.40 pm on Friday, the stock of Adani Gas is trading at Rs 163.00, down by 5.70 per cent against its previous close of Rs 172.85. Its 52-week high is recorded at Rs 185.60 and its 52-week low is Rs 85.00 on BSE.