Buy Guj State Petro; target of Rs 163: Emkay

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26 Aug, 2025 12:21

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Emkay's research report on Guj State PetroOperationally in-line result, however beat came at PAT level on account of higher other income, which is attributable to ~Rs0.17bn of dividend income from Gujarat Gas. Revenue and EBITDA came in line with our est. Revenue came in at Rs2.5bn (our est. Rs2.5bn) and EBITDA came in at Rs2.1bn (our est. Rs2.1bn) Transmission tariff remained flat sequentially at Rs1.07/scm. However, transmission volume increased by 3.1% qoq from 24.3mmscmd to 25.1mmscmd Other expenditure increased from Rs0.17bn to Rs0.3bn due to 1) and fluctuation in SUG cost and 2) in Q2FY16 Company has reported lower other expenditure which was adjusted in Q3FY16. Interest cost declined during the quarter by 13.5% to Rs0.2bn on repayment of debt We expect multiple triggers for GSPL, i.e. 1) sharp correction in spot LNG price - Currently ~$5/mmbtu, 2) upward revision in tariff and 3) expected improvement in volumes from stranded power plants Essar and OPAL. We maintain our Buy reco. with target price of Rs163. Stock currently trades at 11.3x FY17E EPS and 1.6x FY17 P/BFor all recommendations, click here Disclaimer: 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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