India's Mahanagar Gas profit falls in Q1 on higher fuel cost

Indraprastha Gas

25/07/2024 14:59

BENGALURU, July 25 (Reuters) - India's Mahanagar Gas  MGAS.NS  reported a nearly 23%
decline in first-quarter profit on Thursday, hurt by higher fuel costs. 
    The state-backed natural gas distributor's profit after tax fell to 2.85 billion rupees ($34
million) in the quarter ended June 30 from 3.68 billion rupees a year earlier, the company said in
an exchange filing.
    Revenue from operations rose 3.2% to 17.45 billion rupees.
    Total expenses rose 13.6% to 14.01 billion rupees due to higher natural gas costs.
    For further earnings highlights, click  urn:newsml:reuters.com:*:nFWN3JH0RI
        
  
KEY CONTEXT
    Indian city gas distribution firms have been under pressure as they are forced to procure gas
on the more expensive open market, as allocation of natural gas sold under government-set
administered pricing mechanism has fallen due to lower output at domestic wells. 
    Jefferies had expected allocation of gas under administered pricing mechanism for city gas
distribution companies like Mahanagar Gas, Indraprastha Gas  IGAS.NS  and Gujarat Gas  GGAS.NS  to
decline to 70% in the quarter.
             
PEER COMPARISON
        
  
                                Valuation     Estimates (next   Analysts' sentiment           
                                 (next 12        12 months)                                   
                                 months)                                                      
                   RIC        PE      EV/EBI  Revenue  Profit   Mean     # of      Stock to   Div
                                      TDA     growth   growth   rating*  analysts  price      yield
                                              (%)      (%)                         target**   (%)
 Mahanagar Gas      MGAS.NS    15.06    9.35   3.76     -7.87   Buy            18    1.17      1.63
 Indraprastha Gas   IGAS.NS    18.00   12.99   0.97     8.65    Hold           12    1.13      2.62
 Gujarat Gas        GGAS.NS    29.53   17.99   14.17    27.77   Hold           14    1.20      1.05
 Gail (India)       GAIL.NS    14.73   10.86   3.48     8.94    Hold           26    1.08      2.50
 
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong
Sell

** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the
stock is trading above the PT        
        
  
APRIL-JUNE STOCK PERFORMANCE

   

-- All data from LSEG IBES

-- $1 = 83.7340 Indian rupees

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Mahanagar Gas June Qtr 2024 vs Peers    https://tmsnrt.rs/3WBbk9e
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 (Reporting by Ashish Chandra in Bengaluru; Editing by Mrigank Dhaniwala)
 ((ashish.chandra@thomsonreuters.com; +91 7982114624;))