ICICI Direct is bullish on Petronet LNG has recommended buy rating on the stock with a target price of Rs 275 in its research report dated November 06, 2018.
ICICI Direct's research report on Petronet LNG
Petronet LNG reported its Q2FY19 result, which were above our estimates on all fronts. The topline increased 38.3% YoY to Rs 10745.3 crore above our estimates of Rs 9945.9 crore mainly on account of higher LNG prices. The volumes remained flattish and came largely in line with our estimates at 217 tbtu (our estimates: 221.5 tbtu) EBITDA at Rs 883.7 crore also came in above our estimates of Rs 847.6 crore mainly on account of higher blending margins of Rs 49.3/mmbtu (our estimate of Rs 46/mmbtu) owing to higher spot margins as per our internal estimates & lower other expenses due to higher efficiencies On the profitability front, PAT during the quarter declined 4.4% YoY to Rs 562.9 crore above our estimates of Rs 524.6 crore. The upside in PAT was also contributed by higher-than-expected other income of Rs 111.5 crore (our estimate: Rs 72.8 crore).
We value Petronet LNG at 16x FY20E EPS of Rs 17.2 to arrive at a price target of Rs 275 with a BUY rating.
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