Q2FY13 Result Update
Petronet LNG
Buy
Target Price: Rs192
CMP: Rs169
Upside: 13.6%
Spot re-gasification margins shoot up along with volumes aiding profitability
Petronet reported highest ever quarterly profits at Rs3.1bn owing to sequential jump in spot re-gasification volumes and margins. Overall re-gasification volumes for Q2 stood at 135.0TBTUs vs. 127.0TBTUs in Q1. Higher re-gasification margin on spot sales led to 6.6% QoQ jump in blended re-gasification tariffs at Rs44.3/mmbtu (Q1 – Rs41.6/mmbtu). All projects of the company are on track and likely to yield results from Q1CY13 onwards. We remain upbeat on Petronet due to favourable demand-supply of natural gas in India and hence maintain ‘Buy’ rating on the stock.