The shares of this main fuel distribution firm are in focus after it reported a strong fourth quarter and FY25 efficiency, and several other analysts consider in its long-term efficiency. On this article, we are going to dive deep into the small print of it.
With a market capitalization of Rs 13,763 crores, the shares of Mahanagar Gasoline Ltd closed at 1,396 per share on Monday, down by 29.8 p.c from its 52-week excessive of Rs 1,988 per share. During the last 5 years, the inventory has delivered a return of 30 p.c.
Motilal Oswal, a number one brokerage home, says that it sees a goal worth of Rs 1,760 per share, signalling an upside potential of 24.61 p.c from its present stage. It cited that it’s attractively valued after a 30 p.c inventory worth correction and trades at 11x FY27E earnings.
It believes falling crude and fuel costs, current CNG/D-PNG worth hikes, and decrease enter costs are possible to enhance margins. Anticipate 10 p.c quantity development and superior margins to make for a compelling funding case for MAHGL relative to fellow metropolis fuel shares.
Alternatively, ICICI Securities has additionally assigned a purchase name with a goal worth of Rs 1,705 per share, signalling an upside potential of 20.71 p.c from its present stage.
It cited that it sees a strong quantity development, good margins, 15 p.c RoE/ROCE, and enticing valuation (11.4x FY27E P/E), which is low relative to IGL’s and different comparable firms.
Whereas the danger primarily revolves round rising fuel prices from the crude oil worth volatility, it nonetheless sees an upside from lowering LNG costs and accelerated execution of its initiatives. Concurrently, the worldwide big CITI additionally reaffirmed their purchase score on the corporate with a goal worth of Rs 1,700, signalling an upside potential of 20.36 p.c from its present stage.
It cited the identical purpose that it anticipates greater than 10 p.c quantity development, enabled by the growth of its CNG web site, extra industrial quantity, and anticipated M&A plans. The corporate additionally has 55 p.c oil-linked fuel in its portfolio, and expects to keep up sturdy margins sooner or later.
Monetary Highlights
The corporate reported a income of Rs 7,264 crore in FY25, up by 15.49 p.c from its FY24 income of Rs 6,290 crore. Coming to its profitability, it reported a web revenue decline of 18.5 p.c to Rs 1,040 crore in FY25 from Rs 1,276 crore in FY24.
The inventory has delivered an ROE and ROCE of 18.94 p.c and 24.48 p.c respectively, and is at present buying and selling at a P/E of 13.38x as in comparison with its business common of 23.14x.
Mahanagar Gasoline Restricted is among the foremost pure fuel distribution firms in India. They supply piped pure fuel (PNG) to residential customers, business customers like inns and hospitals, and industrial customers throughout many sectors starting from metals, pharma, FMCG, and energy.
Additionally they distribute compressed pure fuel (CNG) to the transport sector and liquefied pure fuel (LNG) to heavy autos. General, they provide pipes and fittings utilized in pipeline infrastructure.
Written by Satyajeet Mukherjee
Disclaimer
The views and funding suggestions expressed by funding consultants/broking homes/score companies on tradebrains.in are their very own, and never that of the web site or its administration. Investing in equities poses a danger of monetary losses. Buyers should due to this fact train due warning whereas investing or buying and selling in shares. Commerce Brains Applied sciences Non-public Restricted or the writer usually are not chargeable for any losses induced on account of the choice based mostly on this text. Please seek the advice of your funding advisor earlier than investing.
