IGL, which had in June picked up 50 percent stake in Kanpur-based Central UP Gas Ltd (CUGL) for about Rs 70 crore, is "looking at inorganic growth opportunities to improve cash flow", a company official said.

CUGL, a joint venture of GAIL (India) Ltd and Bharat Petroleum Corp Ltd (BPCL), will give IGL access to the Kanpur and Bareilly markets of Uttar Pradesh.

And this month, IGL acquired 50 percent stake in Maharashtra Natural Gas Ltd, which sells CNG to automobiles and piped cooking gas to households in Pune, for Rs 190 crore.

The firm has signed “Share Purchase Agreement to acquire up to 5 crore equity shares of Rs 10 each of MNGL at a price of Rs 38 per equity share from certain financial investor shareholders of MNGL in such a manner so that on the completion of the proposed transaction the company's shareholding in MNGL shall not exceed 50 percent of the issued, subscribed and paid up share capital of MNGL,” IGL said in a filing to stock exchanges.

Antique Stock Broking in a research report said the acquisitions bring inorganic growth. “Being nascent entities, both MNGL and CUGL provide terrific growth opportunity for IGL with former rapidly expanding in the Pune area due to its industrial intensity and CNG segment as well”.

With a volume growth expected in the 20-30 percent range during FY14-17, it estimated the two entities together to contribute an EPS of Rs 6 per share to IGL.

In its latest annual report, IGL said: “With the new government focusing on expanding the CGD networks to various cities and increase in penetration of piped natural gas, your company will continue its drive for growth as well as consolidate its presence in Delhi.”

After these acquisitions, IGL said it “is looking at expanding its geographical footprints through similar strategic business opportunities”.

The Company has also plans to participate in the bidding process of PNGRB for setting up CGD business in new cities.

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