Emkay Global Financial's research report on Gujarat State Petronet
GSPL’s Q4FY23 EBITDA came in 9% above our estimates, driven by increased volumes, while a sizeable 27% net income beat was on account of higher other income. GSPL’s capex grew with a Rs1.5/2.0bn cash outlay in H2/FY23 (vs. ~Rs0.8bn p.a. in FY21/22), which could be a thumbs up to PNGRB’s recent tariff reforms. Tariff review of Gujarat grid is expected soon. GSPL reported Q4FY23 SA EBITDA/APAT of Rs2.9bn/Rs2.2bn, down 4%/up 11% YoY and up 9%/31% QoQ. Gas transmission volumes rose 12% QoQ to 25.1mmscmd (down 14% YoY, but a 9% beat), with CGD/refinery-petchem/power sector offtake up 1.5/0.7/0.5mmscmd QoQ.
Outlook
We raise our FY24/25E EPS by 8% each to build-in higher volumes as well as other income, based on the current run-rate. We maintain BUY with a revised Mar-24 TP of Rs360/sh, with tariff review being a key monitorable in the near term.
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