The 28 reports from 9 analysts offering long term price targets
for Gujarat Gas Ltd. have an average target of 378.14. The consensus estimate
represents an upside of 2.99%
from the last price of 367.15.
supported by govt. initiated liquidity measures and 2) strong export demand given cost competitiveness along with opening of new markets in US and Brazil. Improved ceramic market demand augurs well for GGAS as Morbi accounts for over 60% of total sales volumes. Also, ban on competing dirty fuel has led to restricted competition with propane in summer months, thereby improving GGAS's margin visibility. Rising pollution in industrial...
Margin contraction in Q3FY21 is a concern and could keep the stock price volatile in the near term; however, recent roll-back of Rs. 4/scm discount on industrial PNG would improve the margin back to Rs. 5-5.5/scm in Q4FY21. Moreover, volume growth guidance of 10%12% p.a. to drive strong 20% PAT CAGR over FY20-FY23E along with high RoE of 27.5% Potential NGT crackdown of polluting industrial areas in Gujarat and ramp-up of volume from 7 new GAs provides strong impetus for sustained high volume growth. GGAS is one of the best bets in the CGD space as consistent high-volume growth and potential to become net cash positive by FY22 makes valuation of 16.8x its FY23E EPS attractive. Hence, we maintain our Buy rating on GGAS with a revised PT of Rs. 452....
Sales volumes have seen sharp growth post lockdown and are currently at 10.5 mmscmd. We expect growth momentum in industrial PNG segment to continue and build in volume growth in CNG segment from Q4FY21E onwards. In the long term, rise in volumes driven by regulatory tailwinds, further penetration in existing geographical areas (GAs) and aggressive expansion in newly acquired Gas will lead to sustainable growth. We...
Our target price of INR 346 is based on Sept-22E free cash flows (WACC 11%, terminal growth rate 3.0%). The stock is currently trading at 17.5x FY22E EPS. Our ADD recommendation on Gujarat Gas (GGL) with a price target of INR 346 is premised on (1) volume growth of 19% CAGR over FY21-23E, (2) portfolio of mature, semi-mature and new geographical areas (GAs) and (3) compelling valuations given superior return ratios among the city gas distribution players. 2QFY21 EBITDA/APAT was 2/3x above our estimates, primarily owing to, higher-than-expected per unit gross margin, and 6% higher-than-anticipated volumes at 9.85mmscmd.
Benign spot LNG outlook augurs well for GGAS earnings. We increase our FY21E earnings by 24% to factor in sharp volume recovery and margin expansion given benign spot LNG prices. FY22-23E earnings are increased by 8-10% as we increase margins and volumes. GGAS reported strong Q2 earnings led by higher than expected volumes and record spreads...
Volumes were at 906 mmscm which was an increase of 5.4%YoY and of 140% QoQ, with industrial segment growth at 9% YoY and 178% QoQ. Sales from the industrial segment is currently above Pre Covid levels as their sales volume has shown robust recovery post lockdown. Realisations declined sequentially by 3.4% to Rs 28.3/scm as price reduction were taken in industrial segment to compete with alternate...
Historically the Natural Gas usage in India has seen a slowdown with power sector shifting back to coal from Natural Gas due to lower availability of cheap domestic gas and increased dependency on costly R-LNG. However, with R-LNG prices expected to be low, some of the power producers may shift back to Natural Gas. Growth of India's share in the global energy market is expected to increase in the coming years. India has been mainly dependent on high polluting fuels viz. coal, Furnace Oil to meet its ever growing energy needs. GOI; realizing the importance of protecting the...
8 September 2020 Oil & Gas Prior to the National Green Tribunals (NGT) mandate to ban coal gasifiers at Morbi, GUJGAs margins and volumes were highly volatile. This was primarily driven by competition from coal gasifiers. However, post the NGTs ban, the companys volumes and margins (excluding one off in 1QFY21) stabilized. The low LPG prices have enabled few consumers to install LPG equipment at their premises. The total installed capacity currently stands at ~0.6mmscmd for LPG. usage during the monsoons increases to ~0.6mmscmd, while it stands at ~0.3mmscmd for the rest of the year (forming merely ~3-4% of total volumes). Gujarat Gas Since the implementation of the blanket ban on coal gasifiers at Morbi, total industrial sales have increased. Combined with that, BG volumes have also come down slightly from 2.5mmscmd to 2.2mmscmd (the company currently has 3.2mmscmd of long-term contracts).
4 August 2020 EBITDA/scm was better than est. INR4.1) and higher QoQ as well (INR4.7 in 4QFY20). Reported EBITDA was at INR1.85b (-60% YoY; -56% QoQ), with PBT at INR0.8b. PAT came in at INR0.6b (-75% YoY and QoQ). CNG volumes stood at 0.7mmscmd (-54% YoY and QoQ). PNG I/C stood at 2.9mmscmd (-60% YoY; -63% QoQ).
Currently, sales volume are at 5.5 mmscmd, down ~45% from pre-Covid level. In H1FY21E, we expect report volume de-growth with growth set to be seen from Q3FY21E onwards. In the long term, increase in volumes driven by regulatory tailwinds, further penetration in existing geographical areas (GAs) and aggressive expansion in newly acquired gas will lead to sustainable growth. Due to recent run up in stock price, we revise our rating...
SBIN: Core operating profitability remains weak cut to ADD. DIVI: Q4 disappoints downgrade to REDUCE. May MPC Minutes: Room for another 25bps rate cut. GUJGA: Robust margin outlook. IOCL: Covid-19 update operations fast returning to normal
6 June 2020 was marginally lower than est. INR5.0), however, it was higher YoY and QoQ (v/s INR4.3 in 4QFY19 and 3QFY20). Reported EBITDA was 4% higher than estimate at INR4.3b (+68% YoY), led by better-than-expected volumes. Tax rate for the quarter stood at 23.9%. PAT came in at INR2.5b (v/s est. PNG I/C stood at 7.8mmscmd (v/s est.
Robust volumes mostly driven by industrial and domestic PNG segment. Healthy EBITDA spreads. Maintain Accumulate. Gujarat Gas results were in line with estimates on revenue and above estimates on profitability front. Volumes were at 905 mmscm which was an increase of 54.7%YoY and of 5.6% QoQ, with industrial segment growing at 82.3% YoY and of 7% QoQ. Major growth in industrial segment has come from Morbi region (75%) despite worries over anti-dumping duty by GCC for ceramic industry....
Building Materials: Lockdown to mar near-term prospects; structural drivers intact. Weekly Eco Wrap: Markets hopeful of a flattening COVID curve. March MPC Minutes: Growth concerns warranted a larger cut. Inflation: Inflation falls, will ease further
Crude prices witnessed a sharp decline in March due to spread of Covid-19 across the globe and Opec deal failure. A likely increase in oil output by both Saudi Arabia and Russia from Q1FY21E and lower demand are expected to lead to a sizeable oversupply in the oil market. Subsequent low oil prices are expected to significantly affect ONGC's profitability....
