Buy Gujarat State Petronet, target price Rs 500: Motilal Oswal

Motilal Oswal has buy call on Gujarat State Petronet with a target price of Rs 500. The current market price of Gujarat State Petronet Ltd. is Rs 354.

Time period given by analyst is year when Gujarat State Petronet Ltd. price can reach defined target.

Gujarat State Petronet Ltd., incorporated in the year 1998, is a Mid Cap company (having a market cap of Rs 19930.77 Crore) operating in Gas & Petroleum sector.

For the quarter ended 30-06-2021, the company reported a Consolidated Total Income of Rs 3449.24 Crore, down -9.01 % from last quarter Total Income of Rs 3790.79 Crore and up 126.36 % from last year same quarter Total Income of Rs 1523.76 Crore. Company reported net profit after tax of Rs 706.93 Crore in latest quarter.

Investment Rationale
The company would turn net cash by the end of FY23E (v/s a net debt of INR6.6b in FY21), despite annual capex plans of INR7b. The stock trades at 16x FY23E EPS and 10x FY23E EV/EBITDA (owing to a huge rally in GUJGA of ~45% in the last two months).

Promoter/FII Holdings
Promoters held 37.6 per cent stake in the company as of June 30, 2021, while FIIs held 17.5 per cent, DIIs 30 per cent and public and others 14.9 per cent.

(Disclaimer: Views and recommendations given in this section are the analysts’ own and do not represent those of Please consult your financial adviser before taking any position in the stock/s mentioned.

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