Gas pooling policy to help gas-based power producers meet input cost: Gaurav mehta

In a chat with ET Now, Gaurav Mehta, VP - Institutional Equities, Ambit Capital, shares his view on the positive impact gas-pooling policy may have on owners of gas-powered power plants.

ET Now: What is your view on the gas pooling buzz? What do you make of it? Is it just a mere lifeline to some power companies or could it be more meaningful?

Gaurav Mehta: Without going into stock specifics, I think that is a very positive for a lot of gas-based power companies which were sort of running standard power plants till now. From that point of view, I mean obviously the important bit in that policy is that these power companies are not allowed to make return on equity (RoE) on the power generated by these plants. Having said that, it will at least help these companies meet the outstanding fixed, interest and depreciation costs on those power assets.