Emkay Global Financial's research report on Gujarat State Petronet
GSPL posted a 17% EBITDA beat at Rs4.1bn in Q2FY24, led by 13% higher than expected tariff of Rs1.59/scm (up 11% QoQ) owing to a greater share of HP in the mix, amid largely in-line volume. Q2 PAT came in at a 25% beat, at Rs5.3bn, due to lower ETR of 15% (from Gujarat Gas dividend). GSPL’s H1 capex stood at Rs3.3bn vs. Rs462mn YoY/1.98bn HoH, implying rebound in the capex cycle which should lead to favorable tariff revision—albeit, still awaited. Gas transmission volume rose 3% QoQ to 30.2mmscmd (up 23% YoY, in-line) and fertilizer/CGD/others’ offtake was up 1.2/0.4/0.3mmscmd QoQ, while refinery volume fell 1.1mmscmd. We raise FY24E/25E EPS by 22-23% each, to build-in higher Other Income (H1 rate) and slightly higher volume.
Outlook
We maintain BUY with revised Sep-24E TP of Rs335 (roll-over gains offset by lower GUJGA FV).
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