Mahanagar Gas Limited has already connected more than 7 lakh households and nearly 2300 small commercial and industrial establishments. Mahanagar Gas Limited also supplies Compressed Natural Gas(CNG) to more than 3.7 lakh vehicles which include above 1.7 lakh rickshaws and over 57,000 taxis & about 1.3 lakh cars in Mumbai, Thane, Mira-Bhayander, Navi Mumbai and beyond.
Issue Detail of Mahanagar Gas Limited
- Issue Opens: Jun 21, 2016
- Issue Closes: Jun 23, 2016
- Issue Size: 24,694,500 Equity Shares of Rs 10 aggregating up to Rs 1,039.64 Cr
- Face Value: Rs 10 Per Equity Share
- Issue Price: Rs. 380 – Rs. 421 Per Equity Share
- Market Lot: 35 Shares
- Minimum Order Quantity: 35 Shares
- Minimun Investment Amount:Rs.14735 on Upper Band
- Listing At: BSE, NSE
Objective of Public Issue
The company believes that the listing of the Equity shares will enhance its brand name and provide liquidity to the existing shareholders. Listing will also provide a public market for the Equity shares in India. The Company will not receive any proceeds from the offer and aal the proceeds shall go to the Selling Shareholders
Pre-issue promoter group stake in MGL stands at 90 per cent, while public stake(Maharastra Government) is 10 per cent. Post IPO, promoter group stake will decline to 65 per cent.
Financial Health of Mahanagar Gas Limited
Mahanagar Gas Limited’s net profit rose 2.55% to Rs 308.68 crore on 0.76% fall in revenue from operations to Rs 2078.92 crore in the year ended 31 March 2016 over the year ended 31 March 2015.
Mahanagar Gas Limited has consistently generated over 21 per cent RoE and FY11-16 CAGR for revenue, EBITDA and PAT has been 14 per cent, 6 per cent and 6.5 per cent.
It has healthy cash and equivalent balance of Rs 560 crore (in FY16) and average dividend payout of 50 per cent and 40 per cent in the last 5 and 10 years, respectively.
Valuations Compared to Peers
At the upper band of the offer price of Rs 421, Mahanagar Gas Limited is valued at 14x of FY2016 earnings and 12x of FY2016 earnings. On EV/EBITDA basis, it is valued at 6.5x.
Go For it for a quick gain of 10-15%!!!