8 months ago
IGL shares rise 6% after Nomura upgrade
Indraprastha Gas Ltd (IGL) shares went up by 6% on Wednesday.
This happened because a company called Nomura said the stock was a good buy now.
They think the stock was too low and will go up because of some good changes coming.
These changes include lower taxes on gas in Gujarat and lower costs for gas.
Nomura also kept good ratings for two other gas companies, Mahanagar Gas (MGL) and Gujarat Gas.
They think the price of gas from the US (called Henry Hub) will go down soon, which will help these companies.
So, people are buying IGL shares because they think it's a good deal now.
IGL shares rose 6% after Nomura upgraded its rating to 'Buy' and raised the target price to Rs 230.
Nomura expects cost and tax benefits, including a tax reduction in Gujarat and lower transmission costs, to offset recent negatives.
Henry Hub gas prices are expected to cool, providing margin support from Q2 FY27 onwards.
Nomura retained 'Buy' rating on MGL with a target of Rs 1,510 and 'Reduce' rating on Gujarat Gas with a target of Rs 390.
IGL's Ebitda margins are expected to improve sequentially by about 3% in Q4 FY26 due to softer domestic and Brent-linked gas prices.
- Who
- Indraprastha Gas Ltd (IGL), Mahanagar Gas (MGL), Gujarat Gas, Nomura
- What
- IGL shares rose 6% after Nomura upgraded its rating and target price
- Where
- Indian stock market
- When
- Wednesday's trade
- Why
- Nomura cited favorable risk-reward, upcoming cost and tax benefits, and expected cooling of Henry Hub gas prices
Key facts
- Company
- Indraprastha Gas Ltd (IGL)
- Share Price Increase
- 6%
- Nomura's Target Price
- Rs 230
- Previous Target Price
- Rs 215
- MGL Target Price
- Rs 1,510
- Gujarat Gas Target Price
- Rs 390
- Henry Hub Impact
- Expected to cool from seasonally high levels
- Tax Reduction in Gujarat
- 2% from 15% effective October 1
Quotes
Nomura
A global investment banking and financial services firm
“We think that both MGL and IGL are trading at attractive valuation, and imported gas costs could trend lower post-winter (Dec-Feb), while domestic gas prices being linked to Brent will likely remain muted. We upgraded IGL to Buy from Neutral today given attractive valuations after a sharp correction over the past one month, and multiple margin tailwinds.”
businesstoday.in
Sources
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