Citi has maintained a ‘Buy’ rating on Indraprastha Gas Limited (IGL) with a target price of ₹450/share, indicating a potential upside of 5.9% from the current market price (CMP) of ₹425.00.
Key Highlights:
- MNGL Listing Approval: BPCL’s board has given in-principle approval for the listing of Maharashtra Natural Gas Ltd (MNGL), in which IGL holds a 50% stake.
- Value Unlock Potential:
- MNGL contributes ₹45/share to IGL’s target price of ₹450.
- Together with Central U.P. Gas Ltd (CUGL), IGL’s two JVs contribute ₹56/share to its valuation.
- MNGL Profile: MNGL is a joint venture between IGL (50%), BPCL (22.5%), GAIL (22.5%), and the Maharashtra government (5%). It is the authorized city gas distributor in Pune.
- Broader Implications: The listing could also unlock value in GAIL’s unlisted CGD investments, which contribute ₹12/share to GAIL’s target price of ₹280.
Citi sees the MNGL listing as a significant step toward realizing the hidden value of IGL’s JV investments, bolstering its long-term valuation.
Disclaimer: The above analysis is based on inputs provided and is for informational purposes only. It does not constitute financial advice. Readers are advised to consult their financial advisors before making any investment decisions
