IGL - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

📊 Investment Analysis: Indraprastha Gas Ltd. (IGL)

Investment Rating: 3.6

🔍 Fundamental Strengths & Red Flags

ROE: 16.9% and ROCE: 21.4% — healthy efficiency, especially for a utility-oriented business.

EPS: ₹12.3 — reflects solid earnings generation.

PEG Ratio: 3.02 — elevated; implies stock may be overvalued relative to earnings growth.

Debt-to-Equity: 0.01 — practically debt-free, which strengthens its financial resilience.

Dividend Yield: 2.18% — modest but meaningful for passive income seekers.

PAT Growth: 4.60% — lukewarm; suggests stable but slow momentum.

📉 Technical & Valuation Outlook

P/E of 16.8 vs. Industry P/E of 18.5 — slightly undervalued, though PEG indicates growth concerns.

RSI: 41.1 — neutral zone; neither oversold nor overbought.

MACD: -1.93 — reflects short-term bearish sentiment.

Current price below DMA 50/200 — suggests weak technical strength.

Volume slightly below average — indecisive market participation.

FII increased holdings (+2.15%) while DII trimmed stakes (-2.19%) — mixed institutional sentiment.

🎯 Ideal Entry Zone: ₹190 – ₹205 This band aligns with technical supports, cautious valuation, and RSI levels trending towards oversold territory.

🧭 Holding / Exit Strategy

✅ If Holding IGL Already

Suggested Holding Period: 2–4 years IGL fits well in a defensive portfolio with moderate upside driven by urban gas infrastructure and clean energy transition.

Hold if

ROE remains >15% and stable

EPS grows toward ₹14+ over next 4–6 quarters

PEG moderates below 2 through earnings improvement

PAT exceeds ₹500 Cr consistently

🚪 Exit Strategy

Partial Exit: Near ₹265–₹280 if price rallies sharply without supporting EPS or PAT growth.

Full Exit If

ROE slips below 12% for 2+ quarters

PEG rises above 3.5 without growth triggers

Price breaks below ₹180 with bearish MACD and volume spikes

Dividend payout stagnates or institutional sentiment weakens

IGL is a stable, low-volatility option with structural tailwinds, especially in urban energy substitution stories. It won’t dazzle with rapid growth, but it adds polish to any portfolio that values dependability and cash flow.

Would you like to draft a defensive basket with peers like Gujarat Gas, MGL, or NTPC for sector hedging? I’ve got sector-smart comparisons ready to roll 🔍🧮

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