MUMBAI : For Indraprastha Gas Ltd (IGL), India’s largest compressed natural gas distribution company, being under lockdown not only meant a nearly 80% impact on its trading volumes, but also a change in consumer pattern. In an interview for Mint’s Pivot or Perish series, A.K. Jana, managing director, IGL, said that in sync with consumer behaviour, the company is looking at a future with 100% digital payments and processes. Edited excerpts:
In what way is IGL pivoting its business model due to covid-19?
Demand for natural gas was impacted on all four fronts: domestic, industrial, commercial and transportation. While we saw good traction from domestic customers even during the lockdown, demand from industry, commercial sector and transportation suffered due to low business activity. With the unlocking, though demand for the industry is picking up, the commercial sector, which includes hotels and restaurants, is still subdued.
Transport, however, is back to 65-70% of what it was last June. We are expecting it to pick up fast. However, consumer behaviour has changed and we are taking note of that. The customer is very cautious and does not want to transact in cash. So, we are now planning to make our payment methods completely digital, even for customers. So far, around 50% of our transactions were in cash. We are trying to convince people to get our smart cards for digital payments.We will also be taking our tendering process digital, by implementing 100% e-tendering.
What are the lessons from the coronavirus crisis for IGL, and how will you incorporate that in your working?
The biggest learning during the lockdown was that we do not pay attention to migrant labourers. The execution of our projects depends on migrant labourers, and it is stalled now. So, we are working with our contractors to understand how we can make things better for them. First, we are thinking of how to bring them back. Since the situation in Delhi is still not conducive, it’s a challenge. Second, once they are back, we need to provide better facilities. We are also working on providing them with shelter, putting them up in one location, educating them on how to work while maintaining social distancing, and with personal protective gear on.
Has covid-19 forced your company to extend timelines for any project?
Yes, of course. For this fiscal year, the first quarter is gone. Work in the second quarter has slowed down due to the monsoon. So, we are left with only two quarters where work can progress on the ground.Though work on compressed natural gas (CNG) stations is on, as it is in an isolated location, work on laying of the pipelines is impacted due to shortage of labourers.
On the domestic customers front, earlier we used to get 1,000 connection requests per day, today it is down to 200. People are not allowing us to enter their homes for the fear of contracting corona.Though work timelines will get pushed, we are planning to hire more hands (when they are available) and complete the work.
The Petroleum and Natural Gas Regulatory Board (PNGRB) has allowed setting up of LNG stations. Will that impact IGL’s business?
It will not impact our business immediately because there is no transport available which will run on liquefied natural gas (LNG) as of date. Also, it will take time to pick up as infrastructure needs to be created. Besides, all city gas companies can think of investing in their own locations.
Currently, our focus is on how to reduce the queue at our CNG stations. We are planning to add 100 CNG stations this fiscal year, as well as enhancing capacity of our existing stations. We already have 555 CNG stations.