Mahanagar Gas shares jump 9%, hit 52-week high post Q4 results. What should investors do now?

Shares of Mahanagar Gas jumped 9% and hit a 52-week high of Rs 1,088 in Tuesday's trade on BSE after the firm recorded a net profit of Rs 268.8 crore in the fourth quarter of the fiscal year 2022-23, up 104% on-year, compared with Rs 131.8 crore clocked in the corresponding period of the previous financial year.

For the entire FY23, Mahanagar Gas reported a net profit of Rs 790 crore, which is 32% higher than Rs 596 crore recorded in FY22. The revenue from operations in Q4FY23 came in at Rs 1,771.8 crore, which is 67% higher than Rs 1,187.6 crore clocked in the year-ago period.

Its board also declared a final dividend of Rs 16 per equity per share for FY23.


At 10.16 am, the stock was trading 8.5% higher at Rs 1,084 on BSE. On a year-to-date basis, the stock has risen 28%.

Brokerage firm JM Financial maintained its Buy rating on Mahanagar Gas with a revised target price of Rs 1,150 (Earlier: Rs 1,050).

"We maintain Buy on MGL due to its robust pricing power given that CNG is ~45% cheaper vs petrol, and steady volume growth story as CNG penetration in private cars in Mumbai is still only ~20%," it said.

At CMP, MGL is trading at FY25 P/E of 9.6x (3-year avg: 14.2x) and FY25 P/B of 1.8x (3-year avg: 2.6x), JM Financial added.

As per Trendlyne data, the average target price of the stock is Rs 1,071, which shows a downside of 1% from the current market prices.

The consensus recommendation from 24 analysts for the stock is a Buy. Out of these analysts, 17 have strong buy and buy ratings, while only two have strong sell and sell ratings. The remaining five have hold ratings.

Technically, Mahanagar Gas is trading above 8 out of 8 SMAs. The daily RSI (14) is at 53.5. The RSI below 30 is considered oversold and above 70 is overbought, Trendlyne data showed. MACD is at 11.5, which is above its Center Line, but below the signal line.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)