Aegis Logistics‘ share price has remained under pressure in the last year, but analysts at Ventura think things could turn around as the company is the frontrunner in India’s gas story.

The Aegis Logistics Analyst: Ventura analysts initiated coverage on the stock with a “buy” rating and a target price of ₹516. The target indicates a 45% upside from the stock’s last closing price of ₹355.10.

The Aegis Logistics Thesis: The analysts said that Aegis Logistics is rapidly establishing itself as a major player in India’s growing LPG market. Strategic partnerships with global giants Royal Vopak and Itochu Corporation further strengthen its position to execute its ambitious LPG expansion plans.

Before venturing into LPG, the small-cap company built expertise in logistics and storage for chemical and petroleum products. Additionally, climate change concerns and stricter fuel regulations like the NGT’s directives have fueled demand for cleaner fuels like LPG, creating a favourable windfall for the company, the brokerage added.

The company is investing approximately ₹1,500 crore in expanding its logistics and storage capabilities for its core chemicals and petroleum products vertical. This strategic move, coupled with robust market drivers, is expected to propel this division’s revenue to ₹587 crore by FY26, marking a 12.0% CAGR increase.

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Aegis is embracing the future of green fuels by diversifying its services to include green ammonia storage, with an 80,000 MTPA capacity facility under construction in Odisha.

While total revenue might remain flat at ₹8,287 crore (considering current LPG pricing), analysts expect Aegis’s EBITDA to witness a significant CAGR of 22.3%, reaching ₹1,228 crore by FY26. This translates to a 14.8% EBITDA margin, a commendable 703 basis point improvement. Likewise, net earnings are anticipated to climb from ₹463 crore in FY23 to ₹725 crore by FY26, portraying a 16.1% CAGR and an 8.7% net margin, representing a 338 basis point increase.

Price Action: Aegis Logistics’ share price was up 3.18% to trade at ₹366.40 on Thursday afternoon.

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