What is LPG logistics and distribution in India?

LPG logistics involves licensed storage, handling, and last-mile distribution of liquefied petroleum gas from ports/plants to end-distributors. India consumes 50 lakh tonnes LPG daily; geopolitical tensions at Strait of Hormuz (March 2026) have idled six 45,000-tonne carriers, creating acute supply chain gaps. A logistics player can store, manage, and distribute bottlenecked shipments to PSUs and private distributors.

How much does it cost to start LPG logistics in India?

₹15–25 crore for MVP: Storage facility (8,000–10,000 tonnes PESO-approved) = ₹8–12 crore; distribution fleet (50 tankers) = ₹3–5 crore; compliance & working capital = ₹2–3 crore. Scaling to 50,000-tonne multi-location network: ₹50–100 crore over 3–5 years.

Is LPG logistics profitable in India?

Yes. Gross margins: ₹50–100/tonne storage + ₹100–150/tonne distribution = ₹150–250/tonne blended. At 2 million tonnes/year throughput, annual revenue = ₹300–500 crore; EBITDA margin 25–30% = ₹75–150 crore. Geopolitical premium (₹200–300/tonne during shortages) adds ₹50–100 crore/year upside. ROI: 3–4 years at ₹20 crore investment.

What regulations apply to LPG logistics in India?

Licenses: PESO storage approval (Petroleum Act 1934, Section 5), LPG distributor license (Petroleum Act). Safety: Explosives Act 1884 compliance, SPCB consent for environment. GST: 5% on logistics services. Operational: PSC certificate, fire NOC, EIA for >10 MW. Carrier compliance: IATA/IMCO for transport. Approvals timeline: 9–18 months.

LPG Logistics Business India 2026 — Supply Chain Opportunity

AI SummaryIndia's LPG logistics sector faces a critical bottleneck in March 2026 due to geopolitical tensions in the Strait of Hormuz, with six LPG carriers (45,000 tonnes capacity) idled. The market size for LPG distribution is ₹12,000–15,000 crore annually; entrepreneurs can capture ₹500–800 crore through storage terminals and last-mile logistics in high-demand regions (NCR, Gujarat, Maharashtra). This 3–5 year window favors logistics operators, infrastructure developers, and supply chain entrepreneurs who can secure PESO approvals and PSU partnerships before competition intensifies. Timing: Critical shortage expected through June 2026; first-mover advantage for licensed facilities operational by Q3 2026.