Motilal Oswal - Indraprastha Gas Limited (IGL) MOSL: INDRAPRASTHA GAS (Buy)-Far away from the electric shock

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Motilal Oswal

Swarnendu Bhushan

EUR 120.00 For Business Accounts Only

MOSL: INDRAPRASTHA GAS (Buy)-Far away from the electric shock

Indraprastha Gas: Far away from the electric shock

(IGL IN, Mkt Cap USD3b, CMP INR297, TP INR389, 31% Upside, Buy)

The Delhi Cabinet aims to introduce 1,000 electric buses by Jun'20. This is in addition to CNG buses (500 low-floor and 500 normal).
We note that Energy Efficiency Services Ltd (EESL) has not progressed much with the earlier order of 10,000 electric cars. More so, the recent tender of additional 10,000 cars has been quashed indefinitely.
Multiple medium term triggers exist in the form of (a) intercity/highway travel on CNG, (b) higher conversion of LCVs, (c) increasing differential of diesel vehicles v/s petrol/CNG post the BS-VI implementation, (d) increasing launches from OEMs, (e) newer applications, (f) stricter enforcement of pollution norms in industries, and (g) growth in existing and newer areas.

Electric vehicles not ready to take off

EESL floated its first tender for 10,000 EVs in Aug'17, with the first phase of 500 cars to be delivered by Nov'17 and the rest by Jun'18. The tender was closed after much delay in Jan'18, with revised delivery deadline of Mar'19.
Only 10% of the contracted EVs were delivered by end-Dec'18, extending the timeline further to Sep'19.
EESL's tender in Nov'17 for 250 charging stations was finally awarded after cancellation of the first tender (Sept'17) and the follow on snap-bid (Oct'17), pitiful when compared against the ~4,000 charging stations required for efficient running of 10,000 EVs.
The second tender for additional 10,000 EVs in Apr'18 got cancelled as the automobile companies awaited government policies on specifications for the charging infrastructure.

13/03/2019 10 EN

Underlying

Indraprastha Gas Limited

Indraprastha Gas Limited (IGL) is an India-based city gas distribution company. The Company's business consists of sale of natural gas. The Company is focused on industrial and commercial business. The Company supplies compressed natural gas (CNG) to the transport sector and piped natural gas (PNG) to the domestic, industrial and commercial sectors in Delhi and the National Capital Region (NCR). The Company offers PNG, which includes methane-CH4, as well as other hydrocarbons. The Company offers CNG, a gaseous fuel that includes a mixture of hydrocarbons, primarily methane. The Company has approximately 340 CNG stations spread all around the National Capital Territory of Delhi and in NCR. The Company provides PNG connections to over 6.36 lakhs domestic households, and approximately 2,630 commercial and industrial customers.

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INE203G01027 National Stock Exchange of India India

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Motilal Oswal

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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Analysts

Swarnendu Bhushan

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INDRAPRASTHA GAS (IN), a company active in the Gas Distribution industry, now shows a lower overall rating. The independent financial analyst theScreener confirms the fundamental rating of 2 out of 4 stars. However, the market behaviour deterioration triggered a risk requalification, which can be thus described as moderately risky. theScreener believes that increased risk justifies the general evaluation downgrade to Neutral. As of the analysis date November 26, 2021, the closing price was INR 486.40 and its expected value was estimated at INR 501.75.

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MOSL: INDRAPRASTHA GAS (Buy)-Far away from the electric shock

INDRAPRASTHA GAS increases its risk exposure and slightly lowers to Neutral

MOSL: INDRAPRASTHA GAS (Neutral)-Rewarding 2QFY22, although risk-reward unfavorable

MOSL: INDRAPRASTHA GAS (Neutral)-In-line results; real challenge from APM and EVs ahead

MOSL : HOME FIRST FINANCE COMPANY: Earnings in-line with sustained improvement in asset quality

MOSL : SHOPPERS STOP: Ticking the right boxes

MOSL : ERIS LIFESCIENCES: Enhanced efforts toward product launch-related activities

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