Buy Gujarat State Petronet, target price Rs 350: Motilal Oswal

Motilal Oswal has buy call on Gujarat State Petronet with a target price of Rs 350. The current market price of is Rs 239.5.

Gujarat State Petronet Ltd., incorporated in the year 1998, is a Mid Cap company (having a market cap of Rs 13510.04 Crore) operating in Gas & Petroleum sector.

Financials
For the quarter ended 31-12-2020, the company reported a Consolidated Total Income of Rs 3306.35 Crore, up 10.01 % from last quarter Total Income of Rs 3005.58 Crore and up 8.38 % from last year same quarter Total Income of Rs 3050.75 Crore. Company reported net profit after tax of Rs 637.38 Crore in latest quarter.

Investment Rationale
At a 25% holding company discount, the 54% stake in GUJGA provides a valuation of INR225/share for GUJS, thus offering the standalone business at INR11/share. The brokerage values GUJS at 7x standalone and reiterates Buy.

Promoter/FII Holdings
Promoters held 37.6 per cent stake in the company as of Dec 30, 2020, while FIIs held 15.9 per cent, DIIs 31 per cent and public and others 15.4 per cent.