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Jefferies has given buy rating HPCL with a target price of Rs 370. The share price moved down by 2.25 per cent from its previous close of Rs 177.65. The stock’s last traded price is Rs 173.65.
Hindustan Petroleum Corporation Ltd., incorporated in the year 1952, is a Large Cap company (having a market cap of Rs 26583.09 Crore) operating in Gas & Petroleum sector.
Financials
For the quarter ended 30-06-2020, the company reported a Consolidated sales of Rs 37558.80 Crore, down 43.06 % from last quarter Sales of Rs 65967.46 Crore and down 46.93 % from last year same quarter Sales of Rs 70776.43 Crore. The Company reported net profit after tax of Rs 2810.56 Crore in latest quarter.
Investment Rationale
A 16% CAGR in marketing EBITDA and a revival in the refining cycle translate into a 53% CAGR in EBITDA over FY20-23. The stock trades at a 45% discount to the last five-year average one-year forward P/B and a 16% discount to the last five-year average one-year forward EV/EBITDA. With valuations at multi-year lows, the brokerage finds the risk-reward favorable. It initiates coverage with a Buy rating and a price target of Rs370, at 6.3x one-year forward EV/EBITDA.
Promoter/FII Holdings
Promoters held 51.1 per cent stake in the company as of June 30, 2020, while FIIs held 16.1 per cent, DIIs 23.6 per cent and public and others 9.2 per cent
Hindustan Petroleum Corporation Ltd., incorporated in the year 1952, is a Large Cap company (having a market cap of Rs 26583.09 Crore) operating in Gas & Petroleum sector.
Financials
For the quarter ended 30-06-2020, the company reported a Consolidated sales of Rs 37558.80 Crore, down 43.06 % from last quarter Sales of Rs 65967.46 Crore and down 46.93 % from last year same quarter Sales of Rs 70776.43 Crore. The Company reported net profit after tax of Rs 2810.56 Crore in latest quarter.
Investment Rationale
A 16% CAGR in marketing EBITDA and a revival in the refining cycle translate into a 53% CAGR in EBITDA over FY20-23. The stock trades at a 45% discount to the last five-year average one-year forward P/B and a 16% discount to the last five-year average one-year forward EV/EBITDA. With valuations at multi-year lows, the brokerage finds the risk-reward favorable. It initiates coverage with a Buy rating and a price target of Rs370, at 6.3x one-year forward EV/EBITDA.
Promoter/FII Holdings
Promoters held 51.1 per cent stake in the company as of June 30, 2020, while FIIs held 16.1 per cent, DIIs 23.6 per cent and public and others 9.2 per cent