ICICI Securities downgrades India's Gujarat Gas on lower margin concerns

ICICI Securities

12/07/2023 08:23

** Indian gas distributor Gujarat Gas  GGAS.NS  drops as
much as 1.89% to 471.50 rupees after ICICI Securities downgrades
co to "hold" from "buy" on potentially lower margins
    ** Brokerage says drop in Asian LPG prices may impact co's
Q2 FY24 pricing, pose material challenges 
    ** Adds volume growth may require price reduction of 3-4
rupees per standard cubic meter in Q2 FY24, can "significantly
impact" FY24 margins 
    ** Rating house says chasing volumes "risky bet" in weak
pricing environment, slashes TP from 585 rupees to 494 rupees 
    ** More than 927,671 shares changed hands by 12:50 P.M. IST,
0.8x 30-day avg 
    ** Mean recommendation of 27 analysts is "buy"; median TP
531 rupees - Refinitiv IBES data 
    ** GGAS has fallen 2.6% so far this year 

 (Reporting by Hritam Mukherjee in Bengaluru)
 ((Hritam.Mukherjee@thomsonreuters.com;))