Buy Petronet LNG; target of Rs 167: Angel Broking
Angel Broking is bullish on Petronet LNG and has recommended buying the stock with a target price of Rs 167, in its May 02, 2013 research report.
Angel Broking is bullish on Petronet LNG and has recommended buying the stock with a target price of Rs 167, in its May 02, 2013 research report.
The report says, "During 4QFY2013, PLNG's R-LNG volumes were flat yoy at 122TBTUs. The contractual volumes stood at 97TBTUs, while spot cargo and tolling volumes were 25TBTUs mainly because of lower tolling volumes from GAIL and GSPC. However, the company's net sales grew by 32.8 percent yoy to Rs 8,466cr due to higher prices of LNG during the quarter."The report further says, "Higher LNG costs mute bottom-line growth: The cost of LNG regasified increased by 34.7 percent yoy to Rs 7,999cr and hence the EBITDA increased by only 2.7 percent yoy to Rs 434cr whereas the EBITDA margin declined by 150bp yoy to 5.1 percent in 4QFY2013 due to higher proportion of contractual volumes. The other income decreased by 8.4 percent yoy to Rs 20cr, and therefore the net profit was flat yoy at Rs 245cr. Kochi terminal delayed slightly: The Kochi terminal is likely to commence commercial operations during July 2013 (earlier scheduled to begin from April 2013). The second jetty at the Dahej terminal is likely to be ready for operations by 4QFY2014.Outlook and valuation: "PLNG is well-poised to benefit from the gas demandsupply mismatch in the country. It has also lined up aggressive capex plans to increase capacity from 10.0mn tonne to 17.5mn tonne over the coming threefour years. The stock is currently trading at 9.3x FY2014E and 8.3x FY2015E EPS. Valuing the stock at 10.0x FY2015E earnings, we derive a target price of Rs 167 and recommend a Buy rating on the stock," says Angel Broking research report.Quarterly Shifts by Morgan StanleyDisclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. 
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