Fundamentals

INDRAPRASTHA GAS 

Ticker: 532514 BUY: Rs.253.75
Target: Rs.280

IGL is a joint venture company by GAIL and BPCL engaged in the business of supplying natural gas to transport, domestic, commercial and industrial consumers. During Q1FY19, the company’s total volumes grew by 12.5 per cent, with CNG volumes growing by 10.6 per cent YoY and PNG volumes by 18.3 per cent YoY. Also, under the Green Budget scheme, Delhi provides 50 per cent concession on registrations of CNG cars, leading to robust demand in the state. The rising petrol and diesel prices is leading people to opt for CNG conversions. The company’s recent investment in Maharashtra and central UP has led it to tap markets in Pune, Mumbai, Jhansi, Kanpur etc. Considering robust volume growth, led by changing environmental norms, decent margins and foray into new geographical areas, we recommend investors to BUY the scrip.

HINDUSTAN UNILEVER 

Ticker: 500696 BUY: Rs.1569
Target: Rs.1785

HUL, a 52 per cent subsidiary of Unilever, UK, provides products ranging from personal products, home care, beverages and packaged foods. In Q2FY19, its revenue grew by 11.5 per cent YoY with volume growth of 10 per cent. EBITDA increased by 20 per cent YoY and EBITDA margin stood at 21.9 per cent. PAT for the quarter was up by 19.5 per cent YoY and margin stood at 16.5 per cent. The double digit growth in the home care segment was seen with high demand for premium purifiers. The key brands of skin care segment delivered robust growth. The company acquired Adityaa Milk ice cream, which will complement its existing portfolio of Kwality Walls. Demand for products is rising in the rural market. New product launches are adding to company’s strong portfolio base. Considering these factors, we recommend it as a BUY.