Buy Indraprastha Gas Ltd For Target Rs.540 By Yes Securities
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Weak performance on lower EBITDA spreads while overall volumes were in line
Our View
Indraprastha Gas Limited (IGL) reported a mixed Q3 FY24 performance, with Rs5.6bn EBITDA surpassing last year's figures by 31.7% YoY but falling short of our estimates. The Rs3.9bn PAT demonstrated robust 41% YoY growth but experienced a notable 26.7% QoQ decline. Despite meeting volume expectations, higher gas costs impacted EBITDA margins, signalling challenges. With the stock trading at 16.2x/15x FY25e/26e PER, we maintain a BUY rating with a target price of Rs 540/share, recognizing the company's strong margins and sound financials.
