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The board of state-run Bharat Petroleum Corporation (BPCL) on Monday disclosed that its board has given an in-principle approval for the listing of Maharashtra Natural Gas Ltd. (MNGL) through the IPO route.
MNGL is a joint venture between IGL, BPCL and GAIL. IGL holds a 50% stake in the JV, while BPCL and GAIL hold 22.5% stake each. The remaining 5% stake is owned by the Government of Maharashtra.
The MNGL IPO is likely to be worth over ₹1,000 crore and is now subject to regulatory and other approvals. MNGL is an authorised City Gas Distributor in the city of Pune.
Brokerage firm Citi has maintained its “buy” recommendation on Indraprastha Gas, with a price target of ₹450.
Citi wrote in its note that a listing of MNGL could help unlock value for IGL, as its two Joint Venture Companies, MNGL and CUGL, together contribute ₹56 per share to its price target of ₹450 on the stock. Among the two, MNGL contributes ₹45 per share to IGL’s price target by Citi.
The brokerage also said that a potential listing could also help unlock value for GAIL’s investments in unlisted City Gas Distributors, which currently contribute ₹12 per share to its price target of ₹280 on the stock.
However, Citi’s price target on IGL does not indicate significant upside as the target of ₹450 is only 6% away from its closing price on Monday. The stock has recovered from the recent lows but remains 25% below its recent peak of ₹570.
Out of the 36 analysts who have coverage on IGL, 15 analysts each have a “buy” and “sell” rating on the sock, while the other six have a “hold” rating.
Shares of IGL ended 3.7% lower on Monday at ₹425.
First Published: Jan 7, 2025 7:47 AM IST
