Petronet LNG is the top loser

Petronet LNG is currently the top loser on the BSE, down 3.32% at Rs.123.75, closer to its intra day low at Rs.122. Its 52-week low is at Rs.106.10.

The stock is in the red post its very poor performance for Q2FY14 and this trend of poor show had been indicated during its Q1 performance. For the current Q2, the company’s net profit dropped over 42% (YoY) at Rs.182 crore. And the company has blamed this poor show, like in Q1, on lower capacity utilisation and higher depreciation and interest charges on account of capitalisation of the Kochi terminal, which was commissioned, with its 5 MMTPA in Q2. But this is not a one-off problem. This terminal is not expected to run beyond a 7-8% capacity in first year as it neither has customers nor the pipeline to carry the fuel to Karnataka and Tamil Nadu, which is to be put up by GAIL. Till then, it is expected to be sold to a few handful local power companies and to BPCL’s Kochi plant. This situation is expected to ease only by 2015.

The company’s net sales grew by 26% at Rs 9,493 mainly due to higher prices of LNG (liquefied natural gas) during the quarter. Volumes declined by 9% to 123TBTU mainly due to lower tolling volumes from GAIL and GSPC. The cost of LNG re-gasified increased by 30% at Rs 9,032 crore.