Brokerage firm Prabhudas Lilladher has increased its target price for Petronet LNG to Rs 302 from Rs 297. This follows a site visit to the Kochi terminal and updates on infrastructure projects, including a new joint venture for biogas production. Investors are monitoring the progress of these projects, as the Dahej jetty expansion has faced minor delays due to seasonal disruptions.
Prabhudas Lilladher has updated its outlook on Petronet LNG, raising the target price to Rs 302 from Rs 297 while maintaining an 'Accumulate' rating. The brokerage assessment is based on a recent site visit to the Kochi terminal and updates regarding the company's ongoing infrastructure investments. The company is actively working on several key projects, though some have encountered operational hurdles that investors may want to monitor.
Infrastructure Development Progress
The company is expanding its infrastructure, particularly the third jetty at the Dahej terminal. This facility is being designed to handle ethane and propane in addition to LNG. Currently, the project is approximately 71% complete. It has trailed the internal target of 81% set for August 2026, largely due to technical challenges and heavy monsoon-related disruptions. As a result, the commissioning of this facility is now expected in fiscal year 2028. Additionally, progress continues on the company's 750ktpa propane dehydrogenation and 500ktpa polypropylene project, which is planned for a mid-fiscal 2029 rollout.
Shift at Kochi and New Ventures
Operations at the Kochi terminal are evolving with a focus on higher-value services, such as LNG bunkering and cargo delivery. In June 2026, the company successfully completed three cargo delivery operations, each finished within approximately 1.5 days, matching international standards. Upgrades to the bunkering facility are also underway, with completion expected by March 2027. Beyond its existing operations, Petronet LNG is entering the renewable energy sector through a 50:50 joint venture with Gruner Renewable Energy. This partnership aims to build 10 plants to produce compressed biogas, with a total capacity of 180 tonnes per day. The project involves an estimated capital expenditure of Rs 12 billion. However, investors may note that the final funding structure and equity contributions from both partners have not yet been fully finalized.
Investor Monitorables
The brokerage’s valuation approach, based on 10 times the estimated earnings per share for fiscal year 2028, reflects a focus on future growth potential. For shareholders, the most important areas to track include the commissioning timelines for the Dahej jetty and the polypropylene plant, as well as the progress of the new biogas joint venture. The ability of the company to execute these capital-intensive projects on schedule and manage potential cost pressures will be key to its long-term financial performance.