Broker's call: Petronet LNG

Nomura Puts a Buy on Petronet

Nomura has recommended a ‘Buy’ rating on Petronet LNG with a target price of Rs 200. Petronet has seen sharp earnings growth of 53% in FY11 and 71% in FY12.Given a high base, and that Dahej is operating at 100+%, earnings growth could be muted near term. In fact, an earnings decline of 8% in FY14, but this would be mainly due to accounting depreciation as Kochi is commissioned. Petronet best placed & most advanced KGD6 gas declines and a worsened outlook support more LNG imports.