Shares of Indraprastha Gas Ltd (IGL) were in focus today after financial services firm Motilal Oswal reiterated its sell call for the energy major with a target price of Rs 340. The fresh target price is 19% lower to the previous close of Rs 421. However, Indraprastha Gas shares were unaffected by the brokerage’s outlook with the stock gaining after five straight sessions of losses today.
Indraprastha Gas stock touched an intraday high of Rs 431.95, rising 2.56% on BSE. The stock has gained 10.19% in a year and risen 4.07% in 2023. Market cap of the firm rose to Rs 30,219 crore. Total 0.34 lakh shares changed hands amounting to turnover of Rs 1.44 crore on BSE.
In terms of technicals, the relative strength index (RSI) of Indraprastha Gas stock stands at 40, signaling it's neither trading in the overbought nor in the oversold zone. The stock has a beta of 1, indicating average volatility in a year. Indraprastha Gas shares are trading higher than the 50 day, 100 day and 200 day moving averages but lower than 5 day and 20 day moving averages.
The stock hit a 52-week high of Rs 455 on March 3, 2023 and a 52-week low of Rs 335.10 on June 17, 2022.
“For Indraprastha Gas (IGL), we estimate that the 20% penetration of EVs in sales of new CNG vehicles over the next three years would result in a decline in average CNG sales volume growth to 9% from 12% in our base case. Prospects of long-term high-volume growth remain even bleaker for the company. Considering both these headwinds, we reiterate our Sell rating on the stock with a target price of Rs 340,” said Motilal Oswal.
The firm that supplies CNG to automobiles and piped cooking gas to household kitchens in national capital and adjoining towns, reported a 11 percent decline in net profit to Rs 334.06 crore in the December quarter after it held retail prices despite rise in input costs.
The firm reported a profit of Rs 374.76 crore in the corresponding period a year ago. However, sales rose 67.50% to Rs 3710.81 crore in Q3 against Rs 2215.46 crore in the corresponding quarter of the previous fiscal. The company has announced a dividend of 150% for the financial year 2022-23.
Indraprastha Gas Limited is a gas distribution (CGD) company. The company's business consists of sale of natural gas. The company is focused on industrial and commercial business. The company provides gas supply through its extensive distribution network to transport, domestic, commercial, and industrial consumers.
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