Buy Petronet LNG\, target price Rs 300: Emkay Global

Emkay Global has given buy rating to Petronet LNG with a target price of Rs 300. The share price moved up by 0.27 per cent from its previous close of Rs 257.95. The stock’s last traded price is Rs 258.65.

Petronet LNG Ltd., incorporated in the year 1998, is a Large Cap company (having a market cap of Rs 38715.00 Crore) operating in Gas & Petroleum sector.

Financials
For the quarter ended 30-06-2020, the company reported a Consolidated sales of Rs 4883.57 Crore, down 43.00 % from last quarter Sales of Rs 8567.15 Crore and down 43.30 % from last year same quarter Sales of Rs 8613.44 Crore. The Company reported net profit after tax of Rs 520.23 Crore in latest quarter.

Investment Rationale
The brokerage uses DCF and reduces WACC to 10.7% from 11%. Key risks are adverse petroleum/gas prices, slowdown, competition, second Covid wave and capital misallocation

Promoter/FII Holdings
Promoters held 50 per cent stake in the company as of June 30, 2020, while FIIs held 29.2 per cent, DIIs 7.9 per cent and public and others 13 per cent.