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Business News/ Markets / Stock Markets/  Mahanagar Gas Q3 Results: Should you Buy, Sell or Hold the stock post earnings performance

Mahanagar Gas Q3 Results: Should you Buy, Sell or Hold the stock post earnings performance

Mahanagar Gas Q3 Results: The net profit for Mahangar Gas at Rs317.18 crore well from around ₹172 crroe in the year ago quarter. The beat was led by better than expected Q3 Margins helped by lower feedstock costs

Mahanagar Gas share price rise more than 2% as Q3 performance beats estimatesPremium
Mahanagar Gas share price rise more than 2% as Q3 performance beats estimates

Mahanagar Gas share price saw gains of  more than 2% in morning trades on Monday after the Q3 performance reported by the company on Tuesday. The results came better  than expectations led by beat on the margins front.

Total sales volumes reported by Mahanagar Gas in the December Quarter at 3.671 mmscmd (million standard cubic meter per day) improved 2.69% sequentially. The same also grew 7.6% year on year.

The CNG (compressed natural gas) volume at 2.6 mmscmd was up 6%  year on year and 2%  sequential, while overall Piped natural gas (PNG) vols at 1.0 mmscmd were up 11% yoy ( up 5% sequentially) and 3% ahead of estimates .

The revenues from operations at 1,568.76 crore came comparable 

It was the earnings before interest tax depreciation and amortisation that at 448.7 crore grew 75% year on year.

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Analysts at Jefferies India Pvt ltd said that Mahanagar Gas Q3 Ebitda was 19%  ahead of their estimates and 10% ahead of consensus estimates, with gross margins beating estimates on lower feedstock costs while overall volumes were in line with estimates.

Analysts at Yes Securities also said that the overall performance was supported by better spreads and volumes (new high across all segments). EBITDA spreads and volumes came better than their expectations.

 Mahanagar Gas reported net profit at 317.18 Crore that improved sharply from 172 crore in the year ago quarter also came 23% above Jefferies Estimates. 

Analysts at Jefferies said that they will look for management guidance on volume gains post OEM partnership and trajectory of APM shortfall going forward. 

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Mahanagar Gas had cut its  CNG prices by 3 per Kg in October'2023 after the 18% cut in HPHT (high pressure high temperatures)  gas prices With discount to diesel and petrol expanding to 31% and 49%, respectively , commentary on volume growth will be keenly watched, especially post the OEM partnership.  Other key topics to focus on are the shortfall in APM gas feedstock and growth opportunities via inorganic route, said Jefferies analysts.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions



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Ujjval Jauhari
Ujjval Jauhari is a deputy editor at Mint, with over a decade of experience in newspapers and digital news platforms. He is skilled in storytelling, reporting, analysing and writing about stocks, investment ideas, markets, corporates and more. He is based in New Delhi.
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Published: 24 Jan 2024, 01:08 PM IST
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