Bloomberg are reporting that shares of Gujarat Gas Ltd. increased by as much as 1.3% after brokerage house Citi initiated coverage on the stock with a ‘Buy’ rating.
Citi expects the country’s largest city gas distributor by volume to regain some of its lost pricing power going ahead.
The stock has underperformed the entire gas pack, since its relisting in September 2015. The reason being high industrial exposure and its customers’ ability to switch fuels.
Citi expects the company to see material ramp up in its volumes courtesy the recently awarded 16 new geographic areas. However, it adds that the volume potential could remain under-appreciated.
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