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Our view

PLNG’s 1QFY24 reported revenue at Rs 116bn (-18% YoY; -16% QoQ), operating profit at Rs 11.8bn (+11% YoY; +25% QoQ), PAT reported at Rs 7.9bn (+13% YoY; +29% QoQ). Throughput came at 230mmbtu (+11% YoY; +24% QoQ) led by higher capacity utilization and better operating efficiencies. ‘Use or Pay’ revenue of Rs 8.5bn for CY22 remains a recoverable as of date and PLNG is negotiating with concerned parties for the same. The Dahej terminal utilization improved QoQ to 97% (4Q: 77%). We believe that while there could be challenges in the near term to due to volatile LNG price environment, given the macro-economic factors but the in longer India’s dependence on imported LNG is set to rise. Growth to be supported by long term supply contracts with customers, Dahej capacity expansions & jetty project, increase in gas consumption and augmenting of new capacities by 2025 which will increase supply and keep LNG prices below USD 10, thus increasing the demand. FSRU terminal on east coast to be finalized in next 6 months. We continue to maintain our BUY rating.

Result Highlights

? Profitability: Net revenue stood at Rs 116bn (-18% YoY; -16% QoQ) adj. Ebitda and Adj. PAT during the quarter, stood at Rs 11.8bn (+11% YoY; +25% QoQ) and Rs 7.9bn (+13% YoY; +29% QoQ), led by increase in utilization levels and increased volume offtake

? LNG throughput: The total throughput stood higher at 230 mmbtu (+11% YoY & +24% QoQ), on the back of higher capacity utilization and efficiencies

? Dahej Terminal: Dahej throughput for the quarter stood at 217tbtu (4Q: 172tbtu), implying a utilization of 97% (4Q: 77%). The cargo mix included 90tbtu of LT (4Q: 108tbtu), 4.0tbtu of ST (4Q: 3tbtu) and 123tbtu (4Q:61tbtu) of Service cargo. The LT cargo also included 4.5tbtu of Gorgon LNG cargo meant for Kochi Terminal, diverted to Dahej. The current tariff rate at Dahej terminal stands at Rs 59/mmbtu (4Q: Rs 59.9/mmbtu).

? Kochi Terminal: Kochi throughput for the quarter stood at 13tbtu (4Q: 13tbtu), implying a utilization of 20% for the quarter. The cargo mix included only 13tbtu (4Q:13tbtu) of LT cargo. The tariff at Kochi terminal stood at Rs 85/mmbtu.

Valuation

We value PLNG at Mar 24 TP of Rs 280/sh on DCF basis, implying a target PE multiple of 13x FY25e, vs currently trading at 11x.

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