Indraprastha Gas - Poised For A Strong Comeback: Prabhudas Lilladher

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Prabhudas Lilladher Report

Indraprastha Gas Ltd. underperformed the broader index by 20% over last one year, as restricted vehicular movement during pandemic hit FY21 compressed natural gas volumes by 22.5% YoY (CNG accounts for ~70% of the company’s overall FY21 volumes).

However, we expect CNG sales to rise going ahead given-

1. receding pandemic concerns,

2. expanding vaccination coverage,

3. continued preference for personal mobility,

4. favorable fuel economics (CNG ~70% cheaper to petrol) and

5. introduction of 1,000 new CNG buses in Delhi will drive 23% compound annual growth rate volume and earnings over FY21-23E.

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