3 MRPL share price target reports by brokerages below. See what is analyst's view on MRPL share price forecast, rating, estimates, valuation and prediction behind the target. You may use these research report forecasts for long-term to medium term for your investment or trades in 2020.
Given subdued global oil demand and incremental capacity addition, GRMs will likely remain suppressed for a few more months. Originally,it was expected that the INR 150 bphase-III expansion would generate ~USD8/ bbl of GRM when SG GRM is at USD6/bbl. However, MRPL’s GRM has not always been good on a sustainable basis – at times it has been hit by water woes and at times by technical issues. Factoring in the GRM weakness, were vise down our FY20/21 GRM estimate to USD1.7/5.0/bbl from USD2.7/5.3/bbl. Additionally, we forecast a GRM of USD5.5/bbl and utilization of 113% in FY22. MRPL trades at 6.0x FY22E EPS of INR7.7 with an RoE of 12.5%. Valuing the stock at 5x EV/EBITDA, we assign INR53 to the standalone business. Subtracting the valuation of OMPL (INR4/share loss), we arrive at a TP of INR49 for MRPL (from earlier INR59/share). Maintain Neutral.
We have revised our earnings lower to reflect weak GRMs, rupee appreciation and inventory losses. However, lower operating cost, and lower working capital requirement resulting in lower interest cost which will partly mitigate the negative impact. Hence, we now expect MRPL to report an EPS of Rs.-1.6/share in FY19E (earlier Rs.-0.7) and an EPS of Rs.9.4/share in FY20E (earlier Rs.10). At current price, the stock is trading at 6.8x P/E and 0.9x P/B multiples on FY20E earnings. We maintain BUY on MRPL with a revised price target of Rs.75 (earlier Rs.92), valuing it at 5.5x FY20E EV/EBIDTA. Going ahead, we expect MRPL’s profitability to improve on account of i). Improved product mix, ii). Better refining margins iii). Economies of scale, iv). Forward integration - Polypropylene plant and v). Various tax benefits.
SOURCE: Data from D'Market via Quandl. Intraday data delayed 15 minutes.
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