Indraprastha Gas on Friday plunged 12% on the BSE, the biggest fall since April 10, 2012, when it dropped 34%. It declined as much as 12.4% in intra-day trade. Shares of the company closed at Rs 403, down from the previous close of Rs 457.45.

The fall was triggered by downgrades by foreign brokerages Morgan Stanley and Jefferies in the aftermath of Delhi’s new electric vehicle (EV) policy.

The objective of the new policy is to expedite EV adoption, which is a negative for traditional fuel sources such as CNG. The policy targets increasing EVs in the city-state by 5% over the next few months.

According to a Jefferies note, the capital contributes close to 88% of the CGD’s volumes. As a result of the EV policy, almost a third of the volumes could be hit. The foreign brokerage downgraded the stock to ‘hold’ from ‘buy’ and cut its price target by 18%. In a similar move, Morgan Stanley has also downgraded its position on the stock.

Data shows that mutual funds (MFs) and insurance companies lost close to Rs 800 crore. MFs hold close to 10% in the CGD, while insurers hold close to 11%. The stock has gained consistently over 1-year and 3-year periods, rising over 21%.

Indraprastha Gas is the country’s largest city gas distributor or CGD by revenue. At the end of trading on Friday, its market capitalisation fell by over Rs 3,700 crore to Rs 28,210 crore.