Oil & Gas Regulatory Authority (OGRA) approved increase in the gas prices for consumers to meet estimated revenue requirement of Rs556 billion for FY20. The rate hike, if notified as determined by OGRA, will have a direct inflationary impact. Sector-wise, OGRA has proposed highest increase for fertilizer sector (136% for feedstock and 31% for fuel gas price, which may results in up to Rs530/bag impact, where actual increase may potentially be lower. Build-up in inventory is a risk to complete cost pass on for Fertilizer manufacturers. Amongst Cement sector, LUCK is the only player to be affected. However in North, declining furnace oil (FO) prices allow a way out with cost of generation on FO standing at Rs10.9/kWh against Rs13.1/kWh on gas (post price increase), which will limit negative earnings impact. In Steel, ASTL and ISL would be adversely impacted with respective impact on the bottom-line of Rs0.51 and Rs0.92 per share, assuming zero pass-on.