ICICI Direct has given Hold recommendation for Petronet LNG with a target price of Rs. 250 in its research report issued on Jun 10, 2021
ICICI Direct’s research report on Petronet LNG
Petronet LNG reported Q4FY21 results that were in line with estimates on the operating front. However, profitability was lower-than-expected on account of other income. Total volumes were flattish YoY, down 7.2% QoQ to 218 tbtu. Revenues were down 11.6% YoY to Rs 7575.3 crore (estimated: Rs 7920.2 crore). EBITDA was at Rs 1091.1 crore, up 56.4% YoY (our estimate: Rs 1107.7 crore). Blended margins were at Rs 59.3/mmbtu in line with estimates. Other income at Rs 49.2 crore was lower than expectations of Rs 97.8 crore. Subsequently, PAT increased 73.6% YoY to Rs 623.4 crore as profitability was impacted by inventory loss and certain one-offs in the base quarter (I-direct estimate: Rs 685.1 crore).
Outlook
We maintain our HOLD recommendation on the stock. We value Petronet LNG at 11.5x FY23E EPS of Rs 21.7 to arrive at a target price of Rs 250 (earlier Rs 275).