India's Mahanagar Gas sinks as Citi downgrades on possible regulatory pressure

Mahanagar Gas

06/03/2024 05:04

** Shares of Mahanagar Gas Ltd  MGAS.NS  down 13.4% at
1,356.55 rupees, set for worst day in 4 years
    ** Citi downgrades city gas distributor (CGD) to "sell" from
"buy", cuts PT to 1,405 rupees from 1,480 rupees
    ** Says stock will be hit most vs peers from possible
pressure to regulate prices
    ** Oil Minister Hardeep Singh Puri, per ET, on Monday said
will ensure CGDs fully implement natural gas price cap for home
cooking, vehicles
    ** Brokerage believes this will create "a potential overhang
on sustainability of high margins for CGDs"
    ** Higher EBITDA margin vs peers Indraprastha Gas  IGAS.NS 
and Gujarat Gas  GGAS.NS  makes MGAS "more susceptible to any
regulatory pressure" - Citi
    ** Around 2.4 mln shares traded, 4.9x 30-day avg volume
    ** MGAS rated "buy" on avg while IGAS, GGAS rated "hold" -
LSEG data
    ** Stock trims YTD gains to 11.3%


 (Reporting by Nandan Mandayam in Bengaluru)
 ((Nandan.Mandayam@thomsonreuters.com; Mobile: +91 9591011727;))