Sharekhan's research report on Petronet LNG
Q1FY22 adjusted PAT of Rs. 779 crore declined by 19% q-o-q due to lower trading gain of Rs. 104 crore but was 10% above our estimate led by higher other income. We have adjusted reported PAT of Rs. 701 crore for Rs. 147 crore of forex losses & IND-AS adjustments and a Rs. 42 crore one-off receipt related to insurance. Dahej re-gas volume of 196 tBtu posted a decent recovery with growth of 10% q-o-q led by higher long-term/tolling re-gas volume of 101 tBtu/94 tBtu, up 4%/21% q-o-q. However, Kochi re-gas volume remained muted at 12 tBtu, flat q-o-q. Dahej utilisation would remain good in Q2FY23 as the Dabhol terminal is shut in monsoon due to break-water issues; Kochi ramp-up would depend upon normalization of spot LNG price. Dahej expansion on track to get completed in next 2-3 years.
Outlook
We maintain a Buy rating on Petronet LNG with a revised PT of Rs. 248 as valuation of 9.8x/9x FY23E/FY24E EPS is attractive given resilient earnings model and stock offers 4-5% dividend yield.
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