Buy Petronet LNG; target of Rs 380: Religare

PLNG outperformed on all operating metrics in Q1, with PAT surging 98% YoY to Rs 3.8bn (adj. for tax write-backs in Q1FY16). Earnings growth was led by a 40% YoY expansion in operating margins to Rs 38/mmbtu, implying an EBITDA of Rs 6.4bn (+80% YoY). PLNG saw positive marketing margins (15% of EBITDA margins) after three quarters of marketing losses – a key positive. Sustained margin expansion should lead to earnings upgrades. We introduce FY19E earnings and restate BUY on the stock (Sep’17 TP Rs 380).For 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.