High LPG costs to hit diners’ wallets

You will have to shell out more for your plate of pasta, a biryani handi or namkeen and biscuits because the high cost of commercial LPG cylinders, prices of which have recently been raised for the third time and by Rs 933, coupled with an increase in plastic and packaging rates are pushing restaurants and companies to finally take price hikes. Many of them refrained from increasing prices for more than a couple of months since the West Asia war started.

Speciality Restaurants which owns brands such as Oh! Calcutta and Mainland China is looking at increasing the menu rates in a couple of days, said founder Anjan Chatterjee. For the company, the cost of LPG cylinders has gone up by Rs 14 lakh per month. “The rate of LPG cylinders has gone up exponentially. Besides, there is an apprehension in the industry that fuel charges will go up now that the elections are done away with. We are compelled to hike menu rates although the attempt will be to take minimal increases,” said Chatterjee.





For smaller cloud kitchens and cafes, the bigger struggle on ground is to get LPG cylinders at a fair rate.

As of now, about 10% of the food cost was on account of LPG cylinders and this will now go up to 12-15%, said Sagar Daryani, co-founder & CEO at Wow! Momo Foods and president at National Restaurant Association of India (NRAI). “A price rise is the only option to keep business viable,” said Daryani.

Food companies looking at price hikes too
Makers of products such as namkeen, biscuits may look at rolling out price hikes in the coming days to tide over the current price increase, an executive said. In FMCG, some parts of manufacturing are dependent on LPG.

Already, some players such as Gopal Snacks have taken selective price hikes even though the company moved away from LPG to other sources. “Although the availability of cylinders has improved, the rates remain a concern now and it has a direct impact on our conversion cost,” said Mayank Shah, chief marketing officer at Parle Products.


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