Environmental concerns in Delhi have brought to the fore the urgency of using cleaner fuels, which puts IGL in a sweet spot. IGL has a unique identity of a company with a rare mix of volume growth and strong margins, supported by supportive governmental initiatives. Also, growth from new areas like Rewari, Dharuhera, Bawal, Karnal, etc would add to volumes. Webelieve IGL’s investment in Maharashtra Natural Gas (MNGL) and Central UP Gas (CUGL) is positive, giving it access to gas demand in Pune, Kanpur, Bareilly, Unnao and Jhansi. However, given the current valuations, we have a HOLD recommendation on the stock. We value standalone IGL at 24x EPS of Rs 13.6/share and investment in CUGL and MNGL at ~Rs 21 per share to arrive at a target price of RS350.