This inventory greater than doubled investor wealth simply since March
Shares of Mangalore Refinery and Petrochemicals (MRPL) have given stellar returns to its buyers. The inventory has surged practically 140 % since March 2022, from round ₹40 to at present commerce round ₹95 per share.
In comparability, Sensex has fallen round 4 % on this interval.
The midcap inventory touched its 52-week excessive of ₹95.95 on May 23, 2022, and its 52-week low of ₹37.10 on February 24, 2022. It has zoomed 59 % within the final one yr and risen round 85 % in 2022 YTD.
Incorporated in 1988 and primarily based in Mangalore, Mangalore Refinery and Petrochemicals Limited manufacture and sells refined petroleum merchandise in India. It is a subsidiary of Oil and Natural Gas Corporation (ONGC). It produces and sells bitumen, furnace oil, high-speed diesel, xylol, naphtha pet coke, sulphur, and motor gasoline, in addition to polypropylene and different merchandise.
In the March 2022 quarter (Q4FY22), the corporate’s web revenue skyrocketed over 1,000 % to ₹3,008 crore towards a revenue of ₹271.86 crore within the corresponding quarter of the earlier fiscal. Its gross sales additionally jumped 82 % to ₹24,803 crore within the March quarter towards ₹13,615 crore within the year-ago quarter.
Meanwhile, working revenue climbed 225 % to ₹2941 crore for the quarter ended March 2022 towards a revenue of ₹905 crore within the corresponding quarter of the earlier fiscal.
On an annual foundation, the agency’s web revenue got here in at ₹2958 crore in FY22 towards a lack of ₹567.52 crore for the fiscal ended March 2021. Net gross sales rallied 117.50 % to ₹69,727 crore in FY22 versus ₹32,085 crore gross sales in FY21. Operating revenue excluding different earnings climbed 607.65 % to ₹4930.59 crore in March 2022 fiscal towards ₹696 crore revenue within the earlier fiscal.
Despite the stellar This autumn and FY22 outcomes, brokerage home Kotak Securities have a ‘promote’ name on the inventory. The brokerage famous that the corporate’s Singapore refining margins have elevated considerably. It believes such excessive GRMs aren’t sustainable in the long term. Besides that, any significant fall in crude oil costs would possibly lead to stock losses for refineries, usually, it added.
“We recommend SELL (earlier ADD) on the stock with a revised price target of ₹56/share (earlier ₹50/share). Valued MRPL on a PE multiple of 6x FY24E earnings (unchanged), discount to its peers considering its size, NCI and limited retail distribution,” the brokerage mentioned.
Kotak added that it has factored in present increased GRMs and has accordingly elevated its earnings forecast for the agency. It now expects MRPL to report an EPS of ₹10.9 in FY23E (earlier Rs.6.8) and ₹9.4 in FY24E (earlier ₹8.3). With the commissioning of desalination plant, one of many main dangers confronted by the corporate with respect to water availability is lowered, it added.
Meanwhile, holdings of promoters of the agency remained unchanged at 88.58 % within the March 2022 quarter. Two promoters held 88.58 % stake and three.57 lakh public shareholders owned 11.72 % in This autumn.
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