Petronet LNG Ltd - Marketing margins pick-up, Volume disappoints - Emkay

Reco: BUY
CMP: Rs 146
Target Price: Rs 194

- Results were above our and street estimates at the bottom line, mainly due to higher marketing margin on spot volumes

- Lower volume offtake from some of the fertiliser plants due to plant shut down affected regas volume to 127tbtu, decline of 4.8% YoY and 6% QoQ

- Sequentially gross marketing margin has improved from $0.16/mmbtu to $0.73/mmbtu, mainly on account of higher marketing margin earned on short term volume

- At CMP stock trades at 10.3x FY14 EPS and 2.1x P/BV maintain Buy. News on capping marketing margin by PNGRB would keep the stock under pressure

Source : Equity Bulls

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