Gas stocks in focus: MGL, IGL may zoom up to 16%; Gujarat Gas faces hurdle

The Oil Ministry has directed to divert natural gas from industries to city distribution companies to cool-off the elevated domestic gas prices

Domestic gas operators such as Indraprastha Gas and Mahanagar Gas surged in Friday's intra-day trade after the Oil Ministry directed to divert natural gas from industries to city distribution companies to cool-off the elevated domestic gas prices.

Among individual stocks, Indraprastha Gas was the top gainer as it soared over 6 per cent. Meanwhile, Mahanagar Gas and Gujarat Gas spiked 4 per cent each. Industry related gas stocks including Adani Total Gas and Petronet LNG, too, were up 2-3 per cent. 

Amid the Ukraine-Russia war, CNG and piped cooking gas prices have spiralled up to 70 per cent on the back of higher cost of imported fuel.

According to reports, increased allocation shall help meet up to 94 per cent of the demand for CNG to automobiles and piped cooking gas to household kitchens across India.

Given this background, here's a quick technical outlook on prominent gas distribution related stocks:
 

Mahanagar Gas Ltd (MGL)

Likely target: Rs 1,000

Upside potential: 16%

Mahanagar Gas stock has zoomed 16 per cent so far in August, and is exhibiting further up move with the robust chart structure. The weekly chart's formation resembles "Double Bottom" breakout, accompanied by strong volumes. This move has negated the "Death Cross" formation and a reversal could see aggressive longs ahead. The trend is directed towards Rs 1,000 levels, which is the next imminent hurdle. Closing basis support exits at Rs 750 levels. CLICK HERE FOR THE CHART

Indraprastha Gas Limited (IGL) 

Likely target: Rs 500

Upside potential: 15%

Shares of Indraprastha Gas have broken out of the Rs 400 hurdle. This move is hinting at a medium-term optimisum, and the stock is likely ascending towards Rs 500 levels. MACD has firmly climbed over the zero line, pushing momentum in bulls' favour. Closing support comes to Rs 400 levels. CLICK HERE FOR THE CHART

Gujarat Gas Limited (GUJGASLTD)

Outlook: Requires crossing hurdle range

The stock is attempting to breakout the resistance range of Rs 490 – Rs 470 levels on the upside. When this happens, the medium-term bullishness may aim at higher levels of Rs 550. Immediate support exits at Rs 450 levels, based on the daily chart. The MACD is rising over the zero line, signalling a positive momentum. CLICK HERE FOR THE CHART

Gujarat State Petronet Limited (GSPL)

Likely target: Rs 274

Upside potential: 13%

With a conclusive support from the Moving Average Convergence Divergence (MACD), the stock is able to take a cushion near 50-day moving average (DMA). Now, a hike over Rs 248, its 100-DMA, could trigger an upside to Rs 274, which is its 200-DMA mark. Weekly chart shows the counter is making efforts to hold the 200-weekly moving average support of Rs 233 levels. CLICK HERE FOR THE CHART

Adani Total Gas Ltd (ATGL)

Likely target: Rs 4,000

Upside potential: 17%

The stock has been advancing upwards since July 2022, and has zoomed nearly 40 per cent. While the Relative Strength Index (RSI) trades in the overbought category, the trend has endured sell-off. The immediate support comes at Rs 3,000 and the positive bias is ascending towards Rs 4,000 mark. CLICK HERE FOR THE CHART

Petronet LNG Limited (PETRONET)

Outlook: Hovering near 200-DMA

Shares of Petronet LNG are hovering near the 200-DMA mark of Rs 212. Only sustainability over this could push for further up move. A breach or a deviation from the average could lead to a negative bias. Overall, there has not been much excitement over the past three months, as the stock traded in a wide range of Rs 230 to Rs 180. CLICK HERE FOR THE CHART