Dilip Buildcon shares rose to a day high of Rs 415.20 on 7 October, up 3%, after the firm got approval for a Rs 1,800 crore LPG pipeline.

Dilip Buildcon Limited told exchanges it has received a Grant of Authorisation from the Petroleum and Natural Gas Regulatory Board (PNGRB).

The approval lets it lay, build and run an LPG pipeline from Paradip in Odisha to Raipur in Chhattisgarh. The filing came at 10:38 am.

Right now, cooking gas on this route travels by road in tankers. The pipeline is meant to replace that, which the company says will make roads safer.

It will also carry gas straight to the bottling plants of oil marketing companies. Dilip Buildcon will not buy, sell or trade any gas.

It will only build and run the pipe. Its income will come from a transport fee, called a tariff, paid by companies that use the line.

The pipeline will work as a ‘common carrier’, so any eligible user can book space on it.

The project is worth about Rs 1,800 crore, excluding GST. Construction will take 36 months. After that, the company will operate the pipeline for 25 years.

The project will be held by a different business that is entirely controlled by Dilip Buildcon. It is suggested that Dilip Buildcon be given the construction project.

So the work comes in two stages. Build first, earn tariffs later. The company had made an earlier disclosure on 9 September, when it received a Letter of Intent for the project.

The latest filing makes the approval formal. Shareholders also received a dividend of Re 1 per share this year, with an ex-date of 15 September.

At 12:36 pm, it’s trading at Rs 406.40 on NSE, up Rs 5.60 or 1.40% from the previous close of Rs 400.80.

The stock opened at Rs 399.30 and dipped as low as Rs 394.05 earlier in the day. It is down 14.24% so far this year and well below its 52-week high of Rs 538.20, with a market value of around Rs 6,602 crore.

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