IGL shares jump 7% post Q4 results; Jefferies raises target price

IGL Q4 results, Indraprastha gas share price target: Shares of Indraprastha Gas Ltd (IGL) on Wednesday, May 8 remained in the spotlight after the CNG retailer released its Q4 earnings report. Halting the four-day falling trend, the stock rose as much as 7.29 to the day's high of Rs 468.4 on NSE in morning deals. At close, the counter settled at Rs 452.2, up 3.58 per cent. 

IGL Q4 results 

On Tuesday, IGL reported a 16 per cent rise in March quarter net profit as it sold more gas. The net profit of Rs 382.80 crore in the latest January-March quarter was compared to Rs 329.75 crore profit registered a year ago, the company said in a statement.

For the full 2023-24 fiscal (April 2023 to March 2024), net profit soared 21 per cent to Rs 1,748.08 crore as against Rs 1,445.02 crore in the previous year. Turnover slipped marginally to Rs 3,949.17 crore in January-March from Rs 4,042.57 crore in the corresponding quarter of 2022-23.

The gross turnover during the financial year 2023-24 was Rs 15,403.13 crore compared to Rs 15,543.67 crore in the preceding financial year 2022-23 primarily due to cooling off of international gas prices despite increased sales volume.

IGL share price target: Should you buy, sell or hold?

Citi has retained a buy call on the Indraprastha Gas stock with a target price of Rs 510 apiece, implying an upside potential of 16.8 per cent from the previous close. In addition, JP Morgan has maintained a neutral rating with a target of Rs 450 per share. 

Meanwhile, Jefferies has maintained a hold call on Indraprastha Gas. The brokerage has raised the target to Rs 450 from Rs 430. The global brokerage has highlighted the following key points in its note: 

• Q4 EBITDA missed estimates and consensus by 18 per cent/14 per cent respectively
• Q4 EBITDA miss on higher-than-anticipated gas cost
• Higher gas cost despite reduction in spot LNG & HPHT gas prices
• Opex was elevated
• Volumes came in line but were below management guidance
• See the full impact of the 2.5/kg CNG price cut from Q1FY25 onwards
• See pressure on near-term profitability

IGL dividend 2024

The board also recommended a final dividend of Rs 5 per share (face value of Rs 2 per share each) for the financial year 2023-24, subject to shareholders' approval in the ensuing Annual General Meeting (AGM). 

What does IGL do?

IGL operates city gas distribution (CGD) networks across 30 districts in 11 geographical areas across four states of Delhi, Uttar Pradesh, Haryana and Rajasthan.

It has laid out city gas distribution infrastructure in Delhi, Noida, Greater Noida, Ghaziabad, Rewari, Gurugram, Karnal, Kaithal Fatehpur, Ajmer, Pal, Rajsamand, Hamirpur, Shamli, Muzaffarnagar, Banda and parts of Kanpur and Meerut, which consists of more than 25,000 kms of pipeline network.

IGL meets fuel requirements of over 1.7 million vehicles running on CNG through a network of over 850 CNG stations. IGL has connected over two-and-a-half million households in these cities with piped natural gas.

(with PTI inputs)

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