Buy Chennai Petroleum Corporation, target price Rs 355: Anand Rathi

Anand Rathi has buy call on Chennai Petroleum Corporation with a target price of Rs 355. The current market price of Chennai Petroleum Corporation is Rs 259.8.

Chennai Petroleum Corporation, incorporated in the year 1965, is a Small Cap company (having a market cap of Rs 3925.30 Crore) operating in Gas & Petroleum sector.

Chennai Petroleum Corporation key Products/Revenue Segments include Petroleum Products, Other Operating Revenue, Scrap and Power for the year ending 31-Mar-2022.

Financials
For the quarter ended 31-12-2022, the company has reported a Consolidated Total Income of Rs 19218.37 Crore, down -1.51 % from last quarter Total Income of Rs 19512.82 Crore and up 93.35 % from last year same quarter Total Income of Rs 9939.86 Crore. Company has reported net profit after tax of Rs 142.96 Crore in latest quarter.

The company’s top management includes Mr.S M Vaidya, Mr.Deepak Srivastava, Ms.Sukla Mistry, Mr.M B Dakhili, Dr.C K Shivanna, Mr.Ravi Kumar Rungta, Mr.H Shankar, Mr.Rajeev Ailawadi, Mr.S Krishnan, Mr.Arvind Kumar, Mr.Babak Bagherpour. Company has Sreedhar, Suresh & Rajagopalan LLP as its auditors. As on 31-12-2022, the company has a total of 15 Crore shares outstanding.

Investment Rationale
Chennai Petro’s performance has been supported by a strong refining environment driven by gasoil crack spreads since recovery from Covid. The southern market has been short of refining products, making this refinery of strategic importance. Past enhancement projects and a change in the refining slate have led to its strong earnings visibility.

Promoter/FII Holdings
Promoters held 67.29 per cent stake in the company as of 31-Dec-2022, while FIIs owned 5.07 per cent, DIIs 3.25 per cent.