Mahanagar Gas stock soared 2% on Monday's trading session after the company impressed the brokerages by retaining its growth guidance for the financial year.
What Happened: In an analyst meet on June 7, the company guided for a volume growth of 6% to 7% for FY25. This includes a 10% volume growth from Unison Enviro (UEPL). Mahangar acquired UEPL in February 2024 which has 55 CNG stations.
It also given a capex guidance of ₹1,000 crore from which Mahanagar will use ₹800 crore while UEPL will get ₹200 crore. The company also plans to build 25km of infrastructure steel pipeline, a PE of 200km, and 90 CNG stations.
See Also: PM Modi Thanks Bill Gates For Good Wishes, Underscores High-Tech And Greener Future For India
Motilal Oswal gave a "buy" call with a target price of ₹1,565. The brokerage continued their preference for the company over Indraprastha Gas due to its 30% cheaper valuation with a similar medium-term growth profile and lower EV risk.
The analysts expect a 7% volume CAGR in FY24-26, driven by multiple initiatives driven by the company which includes partnering with original equipment manufacturers to drive conversion of commercial CNG vehicles.
Nuvama Institutional Equities also retained its "buy" call with a target price of ₹1,670. The analysts back the company's growth projections on the back of acceleration by UEPL with steady CNG station additions.
Price Action: Shares of Mahanagar Gas rose 2.78% to ₹1,419.50 on Monday afternoon.
Read Next: India’s Aviation Sector Flourish Amid External Risks, Says Vistara CEO
Don't miss a beat on the share market. Get real-time updates on top stock movers and trading ideas on Benzinga India Telegram channel.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.