Accumulate Petronet LNG; target of Rs 249: Dolat Capital
Dolat Capital’s research report on Petronet LNG
PLL Q3FY19 results were below estimates on revenue and operating profitability front due to lower off-take from the Dahej terminal. Results were in line with estimates on net profitability front aided by higher other income. Volumes were at 202 TBTU for Q3FY19. Volumes were lower due to high gas prices. High gas prices are expected to cool-off from March 2019 onwards. Dahej terminal continues to operate at 103% capacity utilization. Kochi terminal utilization remains low and is only expected to improve post completion of Kochi – Mangalore pipeline in June 2019. With gradual capacity addition and increase in re-gasification margins, PLNG is bound to ride the gas demand evolution of India.
We feel that stock should see next round of re-rating post completion of pipelines for Kochi terminal. We reiterate our Accumulate recommendation with a target price of ` 249
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