MOSL: GUJARAT STATE PETRONET (Neutral)-EBITDA marginally above estimate-in-line transmission volumes
​Gujarat State Petronet: EBITDA marginally above estimate; in-line transmission volumes
(GUJS IN, Mkt Cap USD1.6b, CMP INR180, TP INR171, 5% Downside, Neutral)
- Reported revenue rose 15% YoY (+21% QoQ) to INR2.9b, falling short of our estimate of INR3.1b, primarily due to lower implied tariffs. EBITDA of INR2.8b (+15% YoY, +21% QoQ) was ahead of our estimate of INR2.7b due to lower O&M expenses at INR504/mscm (-69% YoY, -32% QoQ). PAT came in at INR1.5b (in-line; +26% QoQ, +20% YoY) – the difference at PAT level declined due to (a) lower depreciation at INR430m (est. of INR507; flat YoY, -7% QoQ), (b) lower interest cost at INR106m (est. of INR130; -37% YoY, -9% QoQ) and (c) higher tax rate at 36.2% (est. of 34.3%, 25.8% in 4QFY17 and 35.5% in 1QFY17).
In-line transmission volumes; lower implied tariff
- Transmission volumes grew 7% YoY (+15% QoQ) to 26.9mmscmd (in-line) in 1QFY18.
- Implied transmission tariff stood at INR1,157/mscm (est. of INR1,200; +8% YoY, -3% QoQ).
- GSPL’s board has approved 11% equity investment in Swan LNG. Swan LNG is implementing Greenfield LNG Port facility, a Floating Storage & Regasification Unit (FSRU) with a regasification capacity of 5mmtpa of LNG at Jafrabad (Gujarat), the total project cost is ~INR40b.
Gujarat State Petronet Limited (GSPL) is a natural gas infrastructure and transmission company engaged in gas transportation business. The Company is engaged in transmission of natural gas through pipelines on an open access basis from supply points to demand centers. It also generates electricity through windmills. Its segments include Gas Transportation and Windmill. It develops energy transportation infrastructure and connects natural gas supply sources, including liquefied natural gas (LNG) terminals to various markets. It has set up a 52.5 megawatt (MW) Wind Power Project at Maliya Miyana (District-Rajkot), Gorsar, and Adodar (District-Porbandar). Its subsidiaries include GSPL India Gasnet Limited, which is engaged in development of Mehsana-Bhatinda and Bhatinda-Jammu-Srinagar pipeline projects, and GSPL India Transco Limited, which is engaged in the development of Mallavaram-Bhopal-Bhilwara-Vijaipur Pipeline Project. It serves various industries, such as power and fertilizer.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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