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Feb 12, 2013, 03.07 PM IST | Source: Moneycontrol.com

Buy Indraprastha Gas; target of Rs 292: Firstcall Research

Firstcall Research is bullish on Indraprastha Gas and has recommended buy rating on the stock with a target of Rs 292 in its February 11, 2013 research report.

Firstcall Research is bullish on Indraprastha Gas and has recommended buy rating on the stock with a target of Rs 292 in its February 11, 2013 research report.
 
“Indraprastha Gas Ltd took over Delhi City Gas Distribution Project in 1999 from GAIL (India) Limited (Formerly Gas Authority of India Limited). The project was started to lay the network for the distribution of natural gas in the National Capital Territory of Delhi to consumers in the domestic, transport, and commercial sectors. With the backing of strong promoters GAIL (India) Ltd. and Bharat Petroleum Corporation Ltd. (BPCL) IGL plans to provide natural gas in the entire capital region. The company supplies natural gas in domestic and commercial sectors along with alternative auto fuel. It operates approximately at 124 CNG stations & supplies piped natural gas (PNG) to approximately 13,085 domestic and 117 commercial consumers. IGL is headquartered at New Delhi.”
 
“Indraprastha Gas Ltd, one of India's natural gas distribution companies. IGL was incorporated to implement the compressed natural gas (CNG) expansion programme and the piped natural gas (PNG) project for varied applications in the domestic and commercial sector, reported its financial results for the quarter ended 31 Dec, 2012. Indraprastha Gas Ltd announced an increase of 24.86% in net profit to Rs 863.3 million for the quarter ended Dec. 31, 2012 as compared to Rs 691.5 million in the prior-year period. Revenue for the quarter rose by 31.11% to Rs.8694.46 million from Rs.6631.34 million, when compared with the prior year period. Reported earnings per share of the company stood at Rs.6.17 a share during the quarter, registering at 24.86% increase over previous year period. Profit before interest, depreciation and tax is Rs.1897.01 millions as against Rs.1519.17 millions in the corresponding period of the previous year.”
 
“At the current market price of Rs 261, the stock P/E ratio is at 9.95 x FY13E and 8.45 x FY14E respectively. Earning per share (EPS) of the company for the earnings for FY13E and FY14E is seen at Rs.26.24 and Rs.30.90 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 34% and 19% over 2011 to 2014E respectively. On the basis of EV/EBITDA, the stock trades at 5.07 x for FY13E and 4.25 x for FY14E. Price to Book Value of the stock is expected to be at 2.29 x and 1.80 x respectively for FY13E and FY14E. We recommend ‘BUY’ in this particular scrip with a target price of Rs 292 for medium to long term investment,” says Firstcall Research report.

Institutional holding more than 40% in Indian cos  

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