Mahanagar Gas (MGL)

FairStock Score: 81/100 — HIGH CONVICTION

Score breakdown: P/E: 2/3 · ROCE: 1/2 · Growth: 0/2 · Dividend: 1/1

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for durable moats, honest numbers, and a price that leaves room for error. Mahanagar Gas, a CNG/PNG/LPG supplier with a ₹11,248 Cr market cap, has some things I like. At ₹1,138.70, it trades at 15.72x earnings and 1.75x book, with book value ₹650.70. The balance sheet is strong: debt/equity 0.03, Altman Z-Score 3.20, Piotroski F-Score 7/9. Returns are respectable: ROE 16.42%, ROCE 22.89%. It generates ₹354 Cr free cash flow and pays a 3.20% dividend yield. Past growth was impressive, with 5-year revenue CAGR of 30.79%, and latest quarter sales were ₹2,058 Cr. But the latest quarter net profit was ₹202 Cr, and profit growth is -39.30%. That divergence tells me costs or margins are under pressure. Sales growth of 13.90% is decent, but not if profit is shrinking. Valuation is the crux. P/E 15.72 looks undemanding, yet the Graham Number is ₹1,145.88 and margin of safety is -6.45%, so I am not getting a bargain. Worse, DCF intrinsic value is only ₹178.76, and EV/EBITDA is -1.55; those figures suggest the market may be pricing in far better economics than I can verify. FairStock Score 81/100 is high conviction, but I do not buy scores; I buy discounted cash flows. Promoter holding at 32.50% is not a controlling majority. MGL is a Stalwart with a utility-like moat and low debt, but at this price I would wait for either profit recovery or a wider margin of safety.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer