Buy Mahanagar Gas, target price Rs 1103 : Prabhudas Lilladher

Prabhudas Lilladher has buy call on Mahanagar Gas with a target price of Rs 1103. The current market price of Mahanagar Gas is Rs 915.

Mahanagar Gas, incorporated in the year 1995, is a Mid Cap company (having a market cap of Rs 8917.16 Crore) operating in Gas & Petroleum sector.

Financials

For the quarter ended 30-09-2022, the company has reported a Standalone Total Income of Rs 1743.51 Crore, up 8.08 % from last quarter Total Income of Rs 1613.19 Crore and up 87.44 % from last year same quarter Total Income of Rs 930.16 Crore. Company has reported net profit after tax of Rs 163.97 Crore in latest quarter.

The company’s top management includes Mr.Manoj Jain, Mr.Sanjib Datta, Mr.Sanjay Shende, Mr.Syed S Hussain, Ms.Malvika Sinha, Mr.Rajeev Bhaskar Sahi, Mr.Venkatraman Srinivasan, Mr.Baldev Singh. Company has SRBC & Co LLP as its auditors.

Investment Rationale
Capping domestic gas prices (APM) is encouraging for CGDs, as they account for around 90% of priority sector demand (CNG + PNG Domestic). Furthermore, falling domestic gas and spot LNG prices is positive for Mahanagar Gas. So, as the approval on the draft recommendations for domestic gas price by Mr. Kirit Parikh committee remains pending, the brokerage is bullish on the counter and has retained its buy rating.

Promoter/FII Holdings
Promoters held 32.5 per cent stake in the company as of 30-Jun-2022, while FIIs owned 25.81 per cent, DIIs 16.05 per cent.