JPMorgan has issued an “Underweight” rating on Gujarat Gas, with a target price of ₹475 per share. The stock rose approximately 12% on Monday following the restructuring announcement at the GSPC group, as the deal is expected to be EPS-accretive for Gujarat Gas.
However, JPMorgan highlights that the reorganization significantly increases Gujarat Gas’s exposure to commodity prices. While the current environment might be favorable due to expected soft gas prices, the elevated valuations—around 28x forward P/E and 17.5x forward EBITDA prior to the announcement—are seen as too high given the increased commodity exposure.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.
