‘A new shock every day,’: Commercial LPG price hike spells double whammy for eateries reeling under cylinder shortage | Mumbai News

The hike has come as a double whammy for restaurants still navigating the aftershocks of a cylinder shortage that had already forced shortened menus and alternative fuels. “It’s a new shock every day,” said Kaustubh Tambe of Aram Vada Pav, CSMT, who runs his kitchen on a mix of induction and gas. At 2.25 cylinders a day, the new pricing translates to roughly Rs 70,000 in additional monthly expense, he said. He had already increased his prices last week: Vada pav from Rs 25 to Rs 30, thalipeeth from Rs 90 to Rs 100. “Can’t keep increasing the price again and again,” he said.

Ankit Gupta of Burma Burma, which runs around 15 restaurants across Delhi-NCR, Mumbai, Bengaluru, Ahmedabad, Kolkata, and Hyderabad, said he needs 350 cylinders a month across five of the outlets while the rest operate on LPG or PNG pipelines. At Rs 1,000 more per cylinder, his company would have to bear an additional cost of Rs 3.5 lakh a month, or roughly Rs 42 lakh a year. “That is a significant cost,” he said. “When gas prices increase, the whole ecosystem moves with it — packaging, stoneware, ceramics. We are also dealing with a labour shortage. Everything adds up.”

Burma Burma, which introduced a marginal price increase in April, is holding for now. “We do not want the price to become a deterrent for people coming to us,” said Gupta.

For Vijay Shetty, president of the Indian Hotel & Restaurant Association (AHAR) and owner of Udupi Shree Krishna in Lower Parel, patience has run out. “When it (cylinder price) rose from Rs 1,800 to Rs 2,000, we absorbed it without much fuss. But this is not possible to absorb,” said Vijay, who is looking at a minimum 20% hike on his menu.

Pradeep Shetty, Spokesperson of Hotel And Restaurant Association (Western India), said the latest LPG price hike will further strain margins and make operations increasingly unsustainable. Pradeep, who is also the vice-president of the Federation of Hotel & Restaurant Associations of India (FHRAI), said the move could accelerate closures and job losses.

“The impact extends beyond individual businesses. Rising fuel costs inevitably affect employment, food pricing, events and banqueting operations, tourism-linked services and the broader supply chain connected to hospitality,” he said.

At 108-year-old Olympia Coffee House in Colaba, third-generation custodian Amir Choudhary said, “We will have to increase the prices; every dish will see a 5 to 10% hike.”

At Bandra’s 88-year-old Lucky Restaurant, which had partially switched to coal to manage the ongoing shortage, owner S Mohsen said he would have to increase prices by 5 to 7%. “The timing makes it worse. It is summer, and the staff are already keen to head home. A few members have even left. The others are complaining about having to work with coal,” he said.

In Bengaluru, Arun Adiga, managing partner at Vidyarthi Bhavan, said, “Bigger players can sustain this, but for smaller ones it is very difficult.” Adiga, who has invested significantly to switch to induction and electric cooking, cutting his LPG usage by one to two cylinders a day, said, “Not everybody has that convenience.”

Tambe, for now, is hoping the government moves faster with PNG connections.

Stating that he is not surprised that the increase was announced after elections, Sagar Daryani, President of NRAI, said, “The prices went up by 10% about a month ago when LPG availability was an issue. Now 50% more… So, that’s technically a 60% jump from the base in March… This is definitely not a good start to the new financial year.”

Daryani, who is also the founder and CEO of Wow! Momo, which has outlets across the country, said, “The industry is anyway battling low demand over the past few months and larger shift in consumer habits to convenience has led to increase in overall food delivery business, which comes at huge commissions and marketing costs, offering deep discounts in summers – low traction months for the industry… A price rise is the only option to keep the business viable.”
Urging the government to roll back the hike, FHRAI’s Shetty said, “A 10 to 15% hike in menu prices is imminent. But even that may not be enough to absorb the impact…Without immediate relief, the hospitality industry, a key employment generator, faces an existential crisis.”