Mahanagar Gas IPO gives Maharashtra a Rs520-crore windfall

The Rs1,040 initial share offer by Mahanagar Gas ltd has brought Maharashtra government windfall gains worth Rs520 crore after the shares of the natural gas distribution company rose 23.5 per cent on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

Shares of Mahanagar Gas Ltd (MGL) rose 23.5 per cent on their trading debut on Friday after its Rs1,040 crore initial public offering received a bumper response.

The state government had invested Rs10 crore to acquire 10 per cent shares in Mahanagar Gas at Rs10 each, joining Gas Authority of India Limited and British Gas Limited, as the third partner.

Following the listing at the BSE and NSE, the shares have gone up to Rs530 crore, giving Rs520 crore profit to the government, said principle secretary at the state's industries department, Apurva Chandra.

MGL shares closed 23.49 per cent higher at Rs519.90 on BSE, while the Sensex climbed 0.54 per cent to 27,144.91 points.

''The huge rise in the share prices is the result of trust shown in the government-private partnership. We are extremely happy that the tax payer's money was invested at the right place, which has given us huge profit,'' said Chandra.

Mahanagar Gas provides piped gas connection to around 8.20 lakh households in Mumbai and Navi Mumbai. It has received permission to extend its operations to Raigad district as well.

''We hope to extend the functioning of the company beyond Mumbai and Navi Mumbai. Apart from households, the company provides CNG to 4.20 lakh vehicles and 1.90 lakh autos, helping to reduce pollution,'' he said.