ATGL - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 3.5

Here’s a detailed analysis of Adani Total Gas Ltd (ATGL)

🧾 Core Financials

Profitability & Growth

PAT grew modestly from ₹149 Cr to ₹162 Cr QoQ, but YoY profit variation is negative at -8.43%, indicating margin pressure.

EPS: ₹5.76 — relatively low for a ₹66,736 Cr market cap.

ROE: 16.7% and ROCE: 17.4% — decent return metrics, but not exceptional for a utility.

Debt & Liquidity

Debt-to-equity: 0.44 — low leverage, a positive for stability.

Dividend Yield: 0.04% — negligible, suggesting reinvestment focus.

📊 Valuation Indicators

Metric Value Industry Avg Remarks

P/E Ratio 105 20.2 Extremely overvalued

P/B Ratio ~16.0 ~3.5 High premium to book value

PEG Ratio 12.1 ~1 Price far exceeds growth

Intrinsic Value ~₹450–₹500 — Overpriced vs fundamentals

The valuation is highly stretched, with PEG suggesting growth expectations are not supported by earnings.

🏢 Business Model & Competitive Edge

Core Operations: City gas distribution (CNG, PNG) across India.

Strengths

Strategic JV with TotalEnergies enhances global expertise and credibility.

Expanding footprint in Tier 2/3 cities with strong infrastructure backing.

Risks

Regulatory pricing caps and input cost volatility.

Weak earnings growth and high valuation may limit upside.

📉 Technical & Entry Zone

Current Price: ₹607

DMA 50/200: ₹616 / ₹660 — trading below long-term average.

RSI: 49.6 — neutral zone.

MACD: -3.24 — bearish crossover.

Suggested Entry Zone: ₹530–₹560 range, ideally near 52-week low of ₹533 or below intrinsic value.

🕰️ Long-Term Holding Guidance

Hold only if already invested, but monitor earnings and valuation.

Avoid fresh entry unless price corrects and PEG normalizes.

Ideal for long-term only if

Volume growth in CNG/PNG sustains above 15% CAGR.

ROE improves above 20% and P/E drops below 50.

Would you like a peer comparison with Gujarat Gas or a breakdown of ATGL’s city expansion strategy?

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