Gujarat Gas - Higher RM cost drags profitability - Emkay

- GGCL results were broadly inline with street and our expectation with revenue at Rs7.7bn and PAT at Rs0.5bn, EBIDTA at Rs0.8bn, against Rs1.4bn, decline of 40.4% YoY.

- EBIDTA/scm has improved QoQ from Rs2.5/scm to Rs2.7/scm however on YoY it decline from Rs.4.6/scm, mainly due to higher raw material cost.

- Natural gas volume sold during the quarter was 289mmscm, decline of 4.3% YoY & 4.9 % QoQ, mainly on the back of lower offtake from industrial retail segment.

- At CMP stock trades at 11.7x CY13 EPS and 2.6x P/bv. News on capping marketing margin by PNGRB would keep the stock under pressure, Accumulate.

Source : Equity Bulls

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