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Mahanagar Gas Ltd - Stock Valuation and Financial Performance

BSE: 539957 | NSE: MGL | Gas Transmission/Marketing | Small Cap

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Mahanagar Gas Share Price

 ₹1,284.30 -15.30 -1.18%
as on 13-Mar'25 16:59

DeciZen - make an informed investing decision on Mahanagar Gas

Overall Rating ⓘ
Bole Toh

1. Quality

Very Good
Check detailed 10 Yrs performace

2. Valuation

Undervalued
Check 10 Yrs Valuation charts

3. Price Trend

Semi Strong
Check Price chart

Mahanagar Gas stock performance -

PE Chart Key Ratios
P/E Ratio (SA):
12.14
Market Cap:
12,837.2 Cr.
52-wk low:
1,075
52-wk high:
1,988.6

Is Mahanagar Gas Ltd an attractive stock to invest in?

1. Is Mahanagar Gas Ltd a good quality company?

Past 10 year's financial track record analysis by Moneyworks4me indicates that Mahanagar Gas Ltd is a good quality company.

2. Is Mahanagar Gas Ltd undervalued or overvalued?

The key valuation ratios of Mahanagar Gas Ltd's currently when compared to its past seem to suggest it is in the Undervalued zone.

3. Is Mahanagar Gas Ltd a good buy now?

The Price Trend analysis by MoneyWorks4Me indicates it is Semi Strong which suggest that the price of Mahanagar Gas Ltd is likely to Rise-somewhat in the short term. However, please check the rating on Quality and Valuation before investing.

10 Year X-Ray of Mahanagar Gas:

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Standalone Basis P Consolidated Basis P
Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end.

Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Mahanagar Gas Ltd has performed well in majority of the past ten years indicating its past ten year financial track record is very good

Value Creation ⓘ

Value Creation Index Colour Code Guide ⓘ

Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23Mar'24TTM
ROCE % ⓘ33%30%33.7%36.9%37.3%37%27.2%23.8%27.6%37.6%-
Value Creation
Index ⓘ		1.51.11.51.71.81.71.00.81.01.8-

Growth Parameters ⓘ

Growth Parameters Colour Code Guide ⓘ

Sales ⓘ2,0952,0782,0342,2332,7912,9722,1533,5606,2996,2457,270
Sales YoY Gr.--0.8%-2.1%9.8%25%6.5%-27.6%65.4%76.9%-0.9%-
Adj EPS ⓘ33.534.839.948.655.680.563.261.180.4131107.1
YoY Gr.-3.9%14.4%21.9%14.5%44.7%-21.5%-3.3%31.5%63%-
BVPS (₹) ⓘ157.5193.5186.3212.1242.9298.9327.2364.2418.5520.6583.1
Adj Net
Profit ⓘ		3003113944805497956246037941,2941,058
Cash Flow from Ops. ⓘ4274195326526859858069049691,563-
Debt/CF from Ops. ⓘ0000000000-

CAGR ⓘ

CAGR Colour Code Guide ⓘ

9 Years 5 Years 3 Years 1 Years
Sales ⓘ12.9%17.5%42.6%-0.9%
Adj EPS ⓘ16.3%18.7%27.5%63%
BVPSⓘ14.2%16.5%16.7%24.4%
Share Price - 6.5% 19.7% 5.4%

Key Financial Parameters ⓘ

Performance Ratio Colour Code Guide ⓘ

Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23Mar'24TTM
Return on
Equity % ⓘ		22.219.822.124.424.529.720.217.720.527.919.4
Op. Profit
Mgn % ⓘ		23.424.531.735.131.935.543.526.218.929.621
Net Profit
Mgn % ⓘ		14.31519.421.519.726.8291712.620.714.6
Debt to
Equity ⓘ		0000000000-
Working Cap
Days ⓘ		3336454842334537324349
Cash Conv.
Cycle ⓘ		-6-9-13-13-13-17-26-14-7-116

Recent Performance Summary

Sales growth is growing at healthy rate in last 3 years 42.62%

Net Profit is growing at healthy rate in last 3 years 27.51%

Return on Equity has declined versus last 3 years average to 19.40%

Sales growth is not so good in last 4 quarters at 5.19%

Latest Financials - Mahanagar Gas Ltd.

Standalone Consolidated
TTM EPS (₹) 107.1 105.9
TTM Sales (₹ Cr.) 7,270 7,598
BVPS (₹.) ⓘ 583.1 582.1
Reserves (₹ Cr.) ⓘ 5,660 5,651
P/BV ⓘ 2.23 2.23
PE ⓘ 12.14 12.28
From the Market
52 Week Low / High (₹) 1075.00 / 1988.55
All Time Low / High (₹) 493.20 / 1988.55
Market Cap (₹ Cr.) 12,837
Equity (₹ Cr.) 98.8
Face Value (₹) 10
Industry PE ⓘ 26.8

Quarterly Results

Standalone Basis
Consolidated Basis
 Mar'24 YoY Gr. Rt. %Jun'24 YoY Gr. Rt. %Sep'24 YoY Gr. Rt. %Dec'24 YoY Gr. Rt. %
Sales (₹ Cr.)ⓘ 1,719 -31,745 3.21,877 8.61,929 11.9
Adj EPS (₹) ⓘ 26.8 -1.428.8 -22.828.6 -16.522.8 -28.9
Op. Profit Mgn % ⓘ 22.91 92 bps23.99 -685 bps21.23 -647 bps16.30 -973 bps
Net Profit Mgn % ⓘ 15.41 24 bps16.31 -549 bps15.06 -452 bps11.68 -672 bps

Management X-Ray of Mahanagar Gas:

Shareholding Pattern

JavaScript chart by amCharts 3.21.5
JavaScript chart by amCharts 3.21.5Promoters:32.5%Institutions:56.85%Non-Institutions:10.65%

Promoter's Holding & Share Pledging

JavaScript chart by amCharts 3.21.5Sep22Dec22Mar23Jun23Sep23Dec23Mar24Jun24Sep24Dec240%5%10%15%20%25%30%35%
Pledged *0.000.000.000.000.000.000.000.000.000.00
* Pledged shares as % of Promoter's holding (%)

Valuation of Mahanagar Gas

MRP
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MOS
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DP
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Base EPS
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DPS
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MRP: ₹ 0
DP: ₹0
Base EPS ₹:
DPS ₹:
MOS (%):
Save my Valuation
Expected EPS Growth Rate:
0%
Base 0%
50%
Expected Rate of Return:
0%
Base 0%
50%
Future PE:
0
Base 0
200
YTD 1Y 3Y 5Y 10Y Max
YTD 1Y 3Y 5Y 10Y Max
YTD 1Y 3Y 5Y 10Y Max
YTD 1Y 3Y 5Y 10Y Max

Event Update

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Analyst's Notes

Mahanagar Gas Ltd: Q2FY24 result update - 04 Nov 2023

Particulars

Q2FY24

(Rs. Cr)

YoY Trend

Comments

Revenue

1,571

1%

Volume growth of 3.4%
EBITDA

479

89%

 
EBITDA Margin

30%

+1400 bps

On account of lower gas cost
PAT

338

106%

 

Good result. EBITDA/SCM remained well above historical level which led to strong earnings growth. Management has guided for capex of Rs. 800 Cr for FY24.

Mahanagar Gas: Q1FY24 Result Update - 07 Aug 2023

Particulars

Q1FY24

YoY Trend

Comments

Revenue

1,538

5.7%

 

EBITDA

521

83%

 

EBITDA Margin

34%

+1400bps

Margin expansion in sync with volumes

PAT

368

99%

 

 

 

 

 

 

 

 

 

Strong numbers supported by volume growth.

 

Mahanagar Gas: Why is it risky to own at current prices? - 16 Jan 2020

The stock price of Indraprastha Gas (IGL) has risen 66% in last 1 year and 36% CAGR in last 3 years. While the EPS growth has been 23% CAGR in the same 3 year period.

We observe that IGL’s valuation has risen from 10-year median P/E of 17x to 29x currently. 

What are utilities companies?

Utilities (gas/power/fuel) operate under license or an exclusivity from the government to source and distribute fuel. Utility companies charge small marketing margin to earn reasonable return on investment (ROE) for laying out investments. Most often the government regulates the profit by way of fixing tariffs of these entities. Utilities deserve to earn reasonable return on investment but these do not add large value to enjoy ROE much higher than Cost of Equity (COE). 

While we are quite optimistic on natural gas adoption across the country (Volume growth of 10% CAGR in near term and 8% CAGR in long term), we do not see any merit in paying up for an utility company. We have seen utilities like oil marketing companies earning just 5-10% in operating margin in their marketing operations (consolidated operating margins appear lower due to refining operations as well). 

However, operating margins of City Gas Distribution (CGD) companies like Indraprastha Gas (IGL) or Mahanagar Gas (MGL) are quite steep thanks to lower cost of gas (facilitated by the government for Natural gas adoption), high volume per outlet (monopoly given in individual cities) and lack of pricing regulation. 

What are the risks?

The regulator, PNGRB has proposed the government to regulate their profitability (ROE) by way of increasing competition or cap on tariffs. This will lead fall in ROE to more normalized levels versus elevated one currently. There are various ways of increasing competition i) sharing carrying capacity, or allowing more than 1 distribution license in same city. PNGRB regulates margins of GAIL such that GAIL earns fixed 13.5% ROCE on its investments. This can be extended to CGD companies too. 

We find that the current optimism from temporary high margins has led the stock price to very high valuation. We do not believe that current margins are sustainable. Besides, high P/E ratio of ~29x on that high EPS makes the company very vulnerable to any regulatory policy in future. 

Even after assuming double digit volume growth, if profitability were to fall by 20%, downside is in the range of 30-45% in next 2 years. At the same time, we do not foresee growth of more than 15% CAGR in EPS over next 3 years in best case scenario. So one has very unfavorable risk-reward scenario. 

We are cautious on MGL despite lower P/E ratio than IGL. Alongwith above reasons, MGL also has lower growth prospects than IGL.

View All Notes

Key Ratios of Mahanagar Gas

Standalone Basis Consolidated Basis

Adj EPS (Rs.)

Sales (Cr.)

ROE (%)

ROCE (%)

Peer Comparison

Company Name CMP(₹)
Change ₹(%)
Market Cap
Net Sales (₹ Cr.)
Latest EPS (₹)
Net Profit Margin %
Latest P/E
Latest P/BV
Mahanagar Gas 1,284.3 -15.3 (-1.2%) Small Cap 6,245 107.1 20.7 12.1 2.2
Guj. State Petronet 272.5 -1.6 (-0.6%) Small Cap 2,032 17.7 63.2 15.5 1.4
Eastern Gases - 0 (0%) Small Cap 254 -28.1 0.1 - -2.5
Rudra Gas Enterprise 68.6 -3.5 (-4.8%) Small Cap 63.8 5.7 7.4 12.7 2.3
Confidence Futurist. 81.9 -2.7 (-3.1%) Small Cap 5.1 1.1 50.6 73.9 1.5

Profit And Loss

(All Figures are in Crores.)
Standalone Basis Consolidated Basis
PARTICULARSMar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23Mar'24
Sales2,0952,0782,0342,2332,7912,9722,1533,5606,2996,245
Operating Expenses ⓘ 1,6051,5691,3911,4531,9061,9201,2222,6375,1154,402
Manufacturing Costs144163174189209211160230268302
Material Costs1,2961,2301,0181,0291,3991,3807472,0454,4353,618
Employee Cost 5156606771818883108118
Other Costs ⓘ 114121139168226248227279305364
Operating Profit ⓘ 4905096437808851,0539319231,1841,843
Operating Profit Margin (%) 23.4%24.5%31.6%34.9%31.7%35.4%43.2%25.9%18.8%29.5%
Other Income ⓘ 4148545878998487112175
Interest ⓘ 12100778912
Depreciation ⓘ 808395111126162174196231274
Exceptional Items ⓘ 0000000000
Profit Before Tax ⓘ 4494726017278379848348061,0561,733
Tax ⓘ 148161207249291190214209265444
Profit After Tax 3013113934785467946205977901,289
PAT Margin (%) 14.4%15.0%19.3%21.4%19.6%26.7%28.8%16.8%12.5%20.6%
Adjusted EPS (₹)33.734.839.848.455.380.362.760.480.0130.5
Dividend Payout Ratio (%)52%50%48%39%36%44%37%41%33%23%

Balance Sheet

(All Figures are in Crores.)
Standalone Basis Consolidated Basis
PARTICULARSMar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23Mar'24

Equity and Liabilities

Shareholders Fund 1,4071,7281,8402,0952,3992,9533,2323,5974,1345,143
Share Capital ⓘ 89899999999999999999
Reserves ⓘ 1,3181,6391,7411,9972,3002,8543,1343,4994,0355,044
Minority Interest0000000000
Debt16431000000
Long Term Debt16431000000
Short Term Debt0000000000
Trade Payables112112120110152132156272322334
Others Liabilities ⓘ 6315266618048901,0441,2131,3651,5761,749
Total Liabilities ⓘ 2,1662,3702,6243,0103,4414,1284,6015,2346,0327,226

Fixed Assets

Gross Block1,6711,2111,4821,8192,1742,6182,9113,5044,1194,878
Accumulated Depreciation607821772874115697428911,0931,335
Net Fixed Assetsⓘ 1,0641,1291,3051,5321,7632,0492,1692,6143,0263,543
CWIP ⓘ 380429412357370487560616709774
Investmentsⓘ 3713934676886541,1211,0251,0881,3101,636
Inventories17182424191922273440
Trade Receivables9692958810068128184294281
Cash Equivalents 14517513692299229512465228398
Others Assetsⓘ 92134187230236154185239432554
Total Assets ⓘ 2,1662,3702,6243,0103,4414,1284,6015,2346,0327,226

Cash Flow

(All Figures are in Crores.)
Standalone Basis Consolidated Basis
PARTICULARSMar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23Mar'24
Cash Flow From Operating Activity ⓘ 4274195326526859858069049691,563
PBT ⓘ 4494726017278379848348061,0561,733
Adjustment ⓘ 5053587282103118144164164
Changes in Working Capital ⓘ 6644608237137601651391
Tax Paid ⓘ -139-150-186-228-271-238-206-212-264-424
Cash Flow From Investing Activity ⓘ -261-222-263-419-439-755-444-539-649-1,267
Capex -197-215-254-269-362-426-340-647-713-770
Net Investments -94-38-43-179-114-376-1406618221
Others ⓘ 313134303847364246-718
Cash Flow From Financing Activityⓘ -176-191-284-226-235-242-349-310-285-312
Net Proceeds from Shares ⓘ 0000000000
Net Proceeds from Borrowing ⓘ 0000000000
Interest Paid ⓘ -100-10-20000
Dividend Paid ⓘ -156-156-282-145-191-178-322-281-252-277
Others ⓘ -19-35-2-81-43-62-26-29-33-35
Net Cash Flow ⓘ -105-15812-11135435-15

Finance Ratio

Standalone Basis Consolidated Basis
PARTICULARSMar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23Mar'24
Ratios
ROE (%)22.2619.8322.0524.2924.3229.6620.0317.4820.4427.79
ROCE (%)33.0330.0233.6536.8937.253727.1923.8327.5537.6
Asset Turnover Ratio1.111.010.90.870.950.860.540.791.231.04
PAT to CFO Conversion(x)1.421.351.351.361.251.241.31.511.231.21
Working Capital Days
Receivable Days1615151411915151315
Inventory Days3334323222
Payable Days31334241343870382433

Mahanagar Gas Ltd Stock News

Mahanagar Gas Ltd FAQs

Company share prices are keep on changing according to the market conditions. The closing price of Mahanagar Gas on 13-Mar-2025 16:59 is ₹1,284.3.
Market capitalization or market cap is determined by multiplying the current market price of a company's shares with the total number of shares outstanding. As of 13-Mar-2025 16:59 the market cap of Mahanagar Gas stood at ₹12,837.2.
The latest P/E ratio of Mahanagar Gas as of 13-Mar-2025 16:59 is 12.14.
The latest P/B ratio of Mahanagar Gas as of 13-Mar-2025 16:59 is 2.23.
The 52-week high of Mahanagar Gas is ₹1,988.6 and the 52-week low is ₹1,075.
The TTM revenue is Trailing Twelve Months sales. The TTM revenue/sales of Mahanagar Gas is ₹7,270 ( Cr.) .

About Mahanagar Gas Ltd

Mahanagar Gas Limited, (MGL) one of the India's leading Natural Gas Distribution Companies was incorporated on May 8, 1995. GAIL (India) Limited (Maharatna Company of Govt. of India) is the promoter of MGL.

Mahanagar Gas (MGL) is one of the leading Natural Gas Distribution Companies in India. MGL is the sole authorized distributor of compressed natural gas (CNG) and piped natural gas (PNG) in Mumbai, Thane and Raigad district of Maharashtra. Promoted by GAIL (India) Limited, the largest state-owned natural gas processing and distribution Company in India and BG Asia Pacific Holdings Pte. Ltd (BGAPH), MGL distributes CNG for motor vehicles and PNG for domestic, commercial as well as industrial use.

Business area of the company

MGL is in the business of City Gas Distribution (CGD), supplying natural gas in the city of Mumbai including its adjoining areas and the Raigad district, in the State of Maharashtra, India.

Services offered by the company

  • Domestic PNG
  • Commercial PNG
  • CNG
  • Industrial PNG
  • Gas Geysers

Awards

  • 2009: MGL Certified for OHSAS 18001:2007 Occupational Health & Safety Management Systems in July 2009
  • 2009: MGL recertified for ISO 14001:2004 in November 2009
  • 2009: 6th CII Western Region SHE award 2009 (Service Sector-Large)
  • 2010: BG Chairman’s Award for Safety 2010
  • 2013: Greentech Safety Award, 2013
  • 2013: Greentech Environment Excellence Award, 2013
  • 2014: Greentech CSR Award, 2014
  • 2015: Greentech CSR Award, 2015
  • 2015: 5th Annual Greentech CSR Award 2015
  • 2015: Pt. Madan Mohan Malviya Award being presented for CSR Initiative - MGL Unnati, 2015
  • 2015: Golden Peacock Award for Corporate Social Responsibility, 2015
  • 2015: Rashtra Vibhushan Award 2015 in Gold Category
  • 2016: Greentech HR Award 2016
  • 2016: Rashtra Vibhushan Award 2016
  • 2016: Greentech Safety Awards 2016 in Gold Category
  • 2016: Best Education Improvement Award by World CSR Day 2016
  • 2016: Rashtra Vibhushan Award 2016-17
  • 2017: The Middle East CSR Leadership Awards 2017
  • 2017: Nava Bharat CSR Leadership Summit Awards 2017
  • 2017: National Award for Excellence in CSR & Sustainability 2017
  • 2017: Innov Awars 2017 in Gold Category
  • 2017: Golden Tigers Award 2017
  • 2018: Yes Bank - Business World Best CFO Award 2018
  • 2018: Social Change Award 2018 by Govt. of India
  • 2018: Financial Express CFO Awards 2018
  • 2019: MGL was conferred with Stars of Industry Award, 2019 for outstanding achievement in CSR.

Major events and milestones

  • 1997-1998: The first natural gas supply and transportation contract was signed with GAIL.
  • 2008-2009: Completed laying 2,000 km of PE pipeline in GA 1.
  • 2010-2011: Completed laying 200 km of steel pipeline in GA 1 and achieved a customer base of 0.5 million domestic customers.
  • 2011-2012: Commissioned 150th CNG dispensing station.
  • 2012-2013: Completed laying more than 350 km of PE pipeline and 350 km of steel pipelines.
  • 2013-2014: Achieved a customer base of 1.0 million customers.
  • 2017: MGL crosses 200th CNG Station mark in MMR
  • 2017-18: Mahanagar Gas sets up First CNG Station in Raigad.
  • 2018-19: Expanded its network in Raigad by operating 10 CNG stations.
  • 2019-20: Crossed a milestone of 250 CNG stations.
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