Motilal Oswal Financial Services

Gujarat State Petronet

BSE SENSEX

44,180

S&P CNX

12,938

18 November 2020

Company Update | Sector: Oil & Gas

CMP: INR192

TP: INR300 (+57)

A decade old – A decade new: a huge opportunity



Buy

Stock Info

Bloomberg

Equity Shares (m)

M.Cap.(INRb)/(USDb)

52-Week Range (INR)

1, 6, 12 Rel. Per (%)

12M Avg Val (INR M)

Free float (%)

GUJS IN

564

108 / 1.5

263 / 146

-8/-41/-23

163

62.4

Financials Snapshot (INR b)

Y/E March

2020 2021E 2022E

Sales

19.4 18.9 20.5

EBITDA

15.7 15.1 16.0

PAT

11.1

9.5 10.0

EPS (INR)

19.7 16.8 17.8

EPS Gr. (%)

39.5 -14.4

5.8

BV/Sh.(INR)

119.2 133.6 149.0

Ratios

Net D:E

-0.6

-0.7

RoE (%)

17.8 13.3 12.6

RoCE (%)

17.5 13.3 12.6

Payout (%)

12.2 14.3 13.5

Valuations

P/E (x)

9.7 11.4 10.7

P/BV (x)

1.6

1.4

1.3

EV/EBITDA (x)

7.1

7.0

6.1

Div. Yield (%)

1.0

FCF Yield (%)

13.5

8.0

7.8

Shareholding pattern (%)

As On

Sep-20 Jun-20 Sep-19

Promoter

37.6

DII

30.9

33.6

33.9

FII

15.6

15.5

Others

15.9

13.2

12.9

FII Includes depository receipts

Stock Performance (1-year)

Guj.St.Petronet

Sensex - Rebased

310

250

190

130



Gujarat State Petronet (GUJS) reported volumes of ~40mmscmd in 2QFY21, taking

the company to near full capacity levels of ~42mmscmd.

We discussed volume growth avenues – both immediate and for the future – with

the management. The following are key insights from the same:



GUJS has installed an additional compressor, which facilitated pipeline capacity

expansion by ~10%, thus taking total pipeline capacity to ~46mmscmd.



While GUJGA stated during its recent earnings that volumes are higher than its

2QFY21 average, the benefits have also accrued to GUJS, which is currently

operating ~44mmscmd (further supported by strong LNG demand).



Although, the company believes that volumes would settle down a bit, as festive

demand is behind us, it could still average ~42mmscmd in 3QFY21.



Also, GUJS is in advance stage of renting an additional compressor to install at

the pipeline connecting the Mundra LNG terminal, further expanding pipeline

capacity by ~0.5mmtpa (~1.8mmscmd).



In addition to the ongoing capex on various other pipelines, the new expanded

capacity of 47-48mmscmd provides opportunity for another 20% volume growth

on its last reported numbers. On similar lines, GUJS expects to fulfill its targeted

volumes growth of 10% per annum.

Over the last five years, EBITDA grew ~11% CAGR, in line with volumes CAGR of ~10%

(to ~38msmcmd in FY20 from 23mmscmd in FY15) despite average implied tariff of

~INR1,215 lower than ~INR1,240 in 2QFY21.

Available LNG regas capacity is expected to jump by 54% to 40mmtpa over the next

2-3 years in Gujarat from the current 24mmtpa, presenting a huge volume growth

opportunity for GUJS.

At a 25% holding company discount, the 54% stake in GUJGA provides a valuation of

INR152/share for GUJS (i.e. ~80% of CMP), thus implying a mere 2x Sep’22E P/E for

the standalone business.

The value of GUJS standalone business is the lowest in its stock price history (refer

Exhibit 5), despite record high volumes, thus presenting an excellent investment

opportunity. Reiterate Buy.

We value GUJS at 8x Sep’22E standalone EPS to arrive at our target price of INR300.

Petchem/refining and fertilizer demand – the roadrunner



India imported ~22.2mmtpa of LNG in 1HFY21, primarily driven by demand

from petchem/refining (up 8% YoY) and fertilizer (up 6% YoY); while power was

flat YoY and CGD was down 33% YoY. Gujarat is assumed to have received

~90% of India’s total LNG imports (GUJS have established pipelines at all three

LNG terminals).



As per power data (by CEA), total electricity demand in the country is down

7% YoY in FY21 YTD, while gas-based power production is up 13% during

the same period.



Fertilizer demand is expected to see a huge volume boost (~11-

12mmscmd) in FY22 as three fertilizer plants get commissioned along the

Jagdishpur-Haldia-Bokaro-Dhamra pipeline (JHBDPL), along with

connectivity to refiners on the Urja-Ganga pipeline.

Swarnendu Bhushan- Research Analyst

(Swarnendu.Bhushan@MotilalOswal.com)

Sarfraz Bhimani - Research Analyst

(Sarfraz.Bhimani@MotilalOswal.com)

Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

Investors are advised to refer through important disclosures made at the last page of the Research Report.

Gujarat State Petronet



Asian spot LNG prices have cooled off to ~USD6-6.5/mmbtu after touching a

high of over USD7.5/mmbtu in the previous month. We believe that spot LNG

prices would further normalize as US gas storage volumes touched fresh highs

last week, while a second wave of COVID in Europe results in lower imports.

The company has already started laying a pipeline to Swan Energy’s LNG

terminal in Jafrabad.

At the start of 2021, GUJS commissioned the Pipavav-Gundala pipeline, which is

transporting gas from Hazira/Dahej to various industries and CGDs (Surat,

Ahmedabad, Gandhinagar, Bhavnagar, Mehsana, Rajkot, Morbi, etc).

NGT has classified five industrial clusters in Gujarat (few of the above mentioned

names) as severely/critically polluted. A strict action like Morbi could increase

transmission volumes for GUJS at these GAs as well.

GSPL India Gasnet (GUJS holds ~52%) is executing partial stretches of Mehsana-

Bhatinda (340km) and Mallavaram-Bhilwara (364km) pipelines. Both have a

capacity of 76-77mmscmd and would eventually enable evacuation of gas from

upcoming LNG terminals on GUJS’ gas grid.

The company plans to spend ~INR22b over the next 3-4 years as capacity

increases from upcoming terminals. This is against net fixed assets (NFA) of

INR43b for the HP pipeline when its tariff was decided in 2018.

The proximity advantage



GAs classified as severely/critically

polluted by NGT

Exhibit 1: Various consumers along the Mehsana-Bhatinda pipeline route

Sector/Industry/Consumer

Cement plants

Fertilizer plants

Refinery/Petchem units

Gas-based IIPs

Textile mills

Bulk industrial consumers

Industrial and CGD projects along the pipeline route

Bhiwani | Rohtak | Sirsa

Bhatinda | Patiala | Ambala

Chandigarh

Location

Gujarat

Rajasthan

Haryana

Punjab

Chandigarh

Source: PNGRB, MOFSL

Exhibit 2: Spot prices climb to ~USD6/mmbtu, implying a

slope of ~15%, which we believe should normalize…

Platts LNG JKM (US$/mmBtu)

Slope (% of Brent)

Exhibit 3: …thus facilitating power consumers as well as

other industrial users

Gas based

YoY growth

Electricity generation

Total

-15

-30

Source: Meti, MOFSL

Source: CEA, MOFSL

18 November 2020

Gujarat State Petronet

Exhibit 4: Domestic gas production continues to record a huge volume decline YoY (despite

CGDs recovering to ~90% YoY); while LNG fills the demand gap

Domestic Gas (YoY % growth)

29%

19%

15% 13%

13%

-2%

-1%

-5%

-4%

-11% -10%

-21%

LNG (YoY % growth)

26%

15%

-1%

-9%

-3%

-1%

-16%

-15% -18% -16%

Source: PPAC, MOFSL

Valuation and view – GUJS trades at the cheapest core business valuation



So far, the regulator has not cut tariff to adjust for the lower tax rate. However,

it is likely to be cut soon. As per our model assumptions, for every 10% change

in tariff, the sensitivity to change in EBITDA/EPS of GUJS is 12/15%.

Exhibit 8 highlights sensitivity to change in tariffs (5%/10%/20%), in line with

upcoming capacities over the next five years. Even at a tariff reduction of 20%,

expected EPS CAGR over FY21-25 is ~9%, while a tariff reduction of 5% would

result in an EPS CAGR of ~16% over the same period.

The company generated ~INR14.5b in FY20 and our model estimates suggest

that FCF generation for FY21-23E combined could be ~INR24.2b. The company

plans on using the excess cash flow for capacity expansion, and would try and

keep implied tariffs at the same level (as IRR is based on gross block).

The stock trades at 10.7x FY22E EPS of INR17.8 and 6.1x FY22E EV/EBITDA, ~50%

discount to its EPS average of the last five years.

Strict action against industrial polluters would further increase the demand of

gas and may result in much higher transmission volumes than that considered

by us. On the risk side, non-approval of capex proposed by GUJS, resulting in

sharp cut in tariff, remains the biggest risk.

Exhibit 6: …(at 1-5x Sep’22E EPS) at various holding company

discounts

Base case

at 25%

discount

Value/share

146

154

300

192

80%

2.0

Bear case

at 50%

discount

Value/share

146

240

192

49%

5.3

Bull case

at 10%

discount

Value/share

146

169

315

192

88%

1.2

Source: MOFSL

Exhibit 5: GUJS’ core business trades at record lows…

INR/share

300

250

200

150

100

GUJS-GUJGA

GUJGA's value in GUJS

GUJS share price

GSPL core

Investments

CMP

Investments as a % of

CMP

Core trading at

Source: MOFSL

18 November 2020

Gujarat State Petronet

Exhibit 7: Gujarat LNG terminal operating capacity to grow over next 3-4 years

LNG terminal

growth in

Gujarat

(mmtpa)

39.5

3.5

24.0

Even considering imminent

incremental volumes (PLNG’s

utilization track record along

with strong JV affiliations, ramp-

up at Mundra to full capacity and

firm contracts with Swan

Energy), additional volumes of

~8mmtpa (i.e. ~28.8mmscmd –

~70% growth on current volumes

of ~40-42mmscmd), are likely in

the near term

Source: PPAC, MOFSL

Pipeline connectivity developments and capex plans



Swan Energy is expected to come up with its 5mmtpa LNG terminal at Jafrabad

by end-2021. It has firm contracts of 4.5mmtpa (GSPC: 1.5, IOCL: 1, BPCL: 1,

ONGC: 1) already. HPCL-Shapoorji is expected to complete its 5mmtpa LNG

terminal at Chhara in another 2-3 years.

GSPC’s Mundra LNG terminal could be operated at 5mmtpa capacity (v/s

current ~2mmtpa) once the Anjar-Chotila pipeline capacity is augmented.

Dahej capacity is expected to increase by 2mmtpa on addition of two tanks and

a third jetty.

All these factors provide GUJS with huge potential to carry an additional

15.5mmtpa of gas on its grid (i.e. ~56mmscmd v/s current yearly volumes of

~40-42mmscmd). Considering the same, we believe capex is inevitable.

Required capex would diminish concerns on sharp reduction in tariff



GUJS has moved to a lower tax rate. To maintain the regulated RoCE as it is

estimated that the regulator may cut its tariff by 10-12%. GUJS has two pipeline

grids – high pressure (HP) and low pressure (LP). The economic lifetime of the

pipelines has been defined as 2026 and 2025, respectively.

The current tariffs of INR34/mmBtu and INR4.08/mmBtu for HP and LP

networks, respectively, have been determined using the above lifetimes.

However, they are likely to receive an extension. This may call for a cut in tariff.

HP network’s tariff of INR34/mmBtu was approved on the basis of 26mmscmd

of transmission volume from FY20. Against this, transmission volume stands

~40mmscmd – thus calling for a cut in transmission tariff for the HP network.

We understand that the company may spend INR18b on spur lines and capacity

augmentation by end-FY23. It also plans on spending ~INR22b over the next 3-4

years as capacity utilization increases from upcoming terminals.

18 November 2020

Gujarat State Petronet

Exhibit 8: GSPL sensitivity to change in tariff – even at 20% reduction, expected EPS CAGR is still 9% over FY21-25

Mundra @ 4.5

Mundra @ 3.5

Assuming following increase in LNG

Jafrabad @ 4.5

Mundra @ 1.5 Mundra @ 2.5

Jafrabad @ 3.5

Jafrabad @ 2.0

Dahej @19.5

terminal capacity utilizations (mmtpa):

Dahej @18.5

Swan @1.0

Sensitivity to change in tariff

FY21E

FY22E

FY23E

FY24E

FY25E

Volumes (mmscmd)

38.5

42.0

52.8

65.4

76.2

Volumes addition (mmscmd)

3.5

10.8

12.6

10.8

Tariff (INR/mmbtu) - 5% reduction

34.0

32.3

Revenue (INR m)

18,960

19,649

24,702

30,597

35,649

PAT (INR m) at 50% margin

5,576

6,083

7,648

9,473

11,037

EPS estimates

13,383

13,566

17,054

21,124

24,612

Tariff (INR/mmbtu) - 10% reduction

Revenue (INR m)

PAT (INR m) at 50% margin

EPS estimates

Tariff (INR/mmbtu) - 20% reduction

Revenue (INR m)

PAT (INR m) at 50% margin

EPS estimates

34.0

18,960

5,576

13,383

34.0

18,960

5,576

13,383

30.6

18,615

6,083

12,532

27.2

16,547

6,083

10,463

30.6

23,402

7,648

15,754

27.2

20,802

7,648

13,154

30.6

28,986

9,473

19,514

27.2

25,766

9,473

16,293

30.6

33,773

11,037

22,736

27.2

30,020

11,037

18,983

EPS CAGR

FY21-25

16%

14%

Source: MOFSL

Exhibit 9: GSPL’s natural gas pipelines under development

Name of pipeline

Mehsana-Bhatinda

Bhatinda-Jammu-Srinagar

Mallavaram-Bhopal -Bhilwara

via Vijaipur

Name of entity

GSPL India Gasnet

GSPL India Transco

Total

Length (km)

2,052

725

2,042

4,774

Capacity

(mmscmd)

77.1

42.4

76.3

195.8

States through which it passes

Gujarat, Rajasthan, Haryana, Punjab

Punjab, Jammu & Kashmir

Andhra Pradesh, Telangana, Madhya

Pradesh, Rajasthan

…as on 30

Sep’19… Source: PPAC, MOFSL

Exhibit 10: GSPL - key assumptions

Y/E March

Net revenue (INR m)

YoY (%)

EBITDA (INR m)

EBITDA Margin (%)

YoY (%)

In INR/mscm

Gas transportation

Transmission Volume (mmscm)

Transmission Volume (mmscmd)

Implied Tariff (INR/mscm)

FY16

9,919

-7%

8,660

87%

-5%

966

8,966

24.5

1,070

FY17

10,276

8,883

86%

979

9,071

24.9

1,109

FY18

13,318

30%

11,478

86%

29%

998

11,506

31.5

1,129

FY19

18,773

41%

15,426

82%

34%

1,222

12,628

34.6

1,455

FY20

19,449

15,749

81%

1,139

13,826

37.8

1,309

FY21E

18,916

-3%

15,123

80%

-4%

1,076

14,053

38.5

1,250

FY22E

20,513

16,047

78%

1,047

15,330

42.0

1,250

FY23E

21,882

17,098

78%

1,041

16,425

45.0

1,250

Source: MOFSL

18 November 2020

Gujarat State Petronet

Financials and Valuations

Standalone - Income Statement

Y/E March

Total Income from Operations

Change (%)

EBITDA

Margin (%)

Depreciation

EBIT

Int. and Finance Charges

Other Income

PBT after EO Exp.

Total Tax

Tax Rate (%)

Reported PAT

Adjusted PAT

Change (%)

Margin (%)

FY16

9,919

-6.8

8,660

87.3

1,829

6,831

799

656

6,688

2,235

33.4

4,454

8.5

44.9

FY17

10,276

3.6

8,883

86.4

1,791

7,092

596

882

7,378

2,412

32.7

4,966

11.5

48.3

FY18

13,318

29.6

11,478

86.2

1,750

9,728

354

735

10,108

3,424

33.9

6,685

34.6

50.2

FY19

18,773

41.0

15,426

82.2

1,800

13,626

2,192

594

12,028

4,081

33.9

7,947

18.9

42.3

FY20

19,449

3.6

15,749

81.0

1,966

13,783

1,645

649

12,786

1,699

13.3

11,087

39.5

57.0

FY21E

18,916

-2.7

15,123

79.9

2,195

12,928

979

700

12,650

3,162

25.0

9,487

-14.4

50.2

FY22E

20,513

8.4

16,047

78.2

2,370

13,677

979

718

13,416

3,381

25.2

10,036

5.8

48.9

(INR m)

FY23E

21,882

6.7

17,098

78.1

2,603

14,495

979

656

14,173

3,572

25.2

10,602

5.6

48.4

Standalone - Balance Sheet

Y/E March

Equity Share Capital

Total Reserves

Net Worth

Total Loans

Deferred Tax Liabilities

Capital Employed

Gross Block

Less: Accum. Deprn.

Net Fixed Assets

Capital WIP

Total Investments

Curr. Assets, Loans&Adv.

Inventory

Account Receivables

Cash and Bank Balance

Loans and Advances

Curr. Liability & Prov.

Account Payables

Other Current Liabilities

Provisions

Net Current Assets

Appl. of Funds

E: MOFSL estimates

FY16

5,633

35,058

40,692

10,670

4,724

56,085

33,059

1,829

31,230

7,679

7,311

12,243

1,177

1,518

5,529

4,019

2,378

150

2,088

140

9,865

56,085

FY17

5,636

39,324

44,960

6,305

4,719

55,984

35,277

3,620

31,657

6,864

7,655

12,158

1,123

1,216

8,026

1,792

2,350

138

2,088

124

9,808

55,983

FY18

5,638

45,012

50,650

17,595

4,984

73,229

36,512

5,371

31,142

8,959

41,814

7,571

1,235

3,645

1,456

16,256

185

15,932

138

-8,685

73,229

FY19

5,640

51,800

57,440

12,856

5,226

75,522

43,245

7,170

36,075

4,194

42,772

6,459

1,279

2,081

1,583

1,516

13,978

238

13,523

216

-7,518

75,522

FY20

5,641

61,584

67,226

5,441

4,081

76,748

44,994

9,137

35,857

2,372

46,111

5,764

1,261

1,637

957

1,908

13,356

410

12,670

276

-7,592

76,748

FY21E

5,641

69,716

75,357

5,441

4,081

84,880

48,392

11,331

37,060

1,974

46,111

12,720

1,293

1,592

7,978

1,856

12,986

420

12,297

268

-267

84,879

FY22E

5,641

78,395

84,036

5,441

4,081

93,559

52,471

13,702

38,769

2,895

46,111

19,983

1,523

1,726

14,721

2,013

14,200

495

13,414

291

5,783

93,559

FY23E

5,641

87,641

93,282

5,441

4,081

1,02,805

58,287

16,304

41,982

4,079

46,111

25,843

1,631

1,842

20,223

2,147

15,211

530

14,370

311

10,632

1,02,804

18 November 2020

Gujarat State Petronet

Financials and Valuations

Ratios

Y/E March

EPS

Cash EPS

BV/Share

DPS

Payout (%)

Valuation (x)

P/E

Cash P/E

P/BV

EV/Sales

EV/EBITDA

Dividend Yield (%)

FCF per share

Return Ratios (%)

RoE

RoCE

RoIC

Working Capital Ratios

Fixed Asset Turnover (x)

Asset Turnover (x)

Inventory (Days)

Debtor (Days)

Creditor (Days)

Leverage Ratio (x)

Current Ratio

Interest Cover Ratio

Net Debt/Equity

FY16

7.9

11.1

72.2

1.5

22.8

24.2

17.1

2.6

11.4

13.0

0.8

7.6

11.6

10.1

13.1

0.3

0.2

5.1

8.5

-0.1

FY17

8.8

12.0

79.7

1.5

20.5

21.7

15.9

2.4

10.3

11.9

0.8

14.9

11.6

10.5

13.8

0.3

0.2

5.2

11.9

-0.2

FY18

11.9

15.0

89.8

1.8

16.9

16.1

12.8

2.1

9.1

10.6

0.9

33.4

14.0

11.6

24.6

0.4

0.2

0.5

27.5

-0.6

FY19

14.1

17.3

101.8

2.0

16.1

13.6

11.1

1.9

6.3

7.7

1.0

10.9

14.7

13.6

39.3

0.4

0.2

0.5

6.2

-0.5

FY20

19.7

23.1

119.2

2.0

12.2

9.7

8.3

1.6

5.8

7.1

1.0

25.7

17.8

17.5

44.0

0.4

0.3

0.4

8.4

-0.6

FY21E

16.8

20.7

133.6

2.0

14.3

11.4

9.2

1.4

5.6

7.0

1.0

15.4

13.3

34.6

0.4

0.2

1.0

13.2

-0.6

FY22E

17.8

22.0

149.0

2.0

13.5

10.7

8.7

1.3

4.8

6.1

1.0

14.8

12.6

34.9

0.4

0.2

1.4

14.0

-0.7

FY23E

18.8

23.4

165.4

2.0

12.8

10.2

8.2

1.2

4.2

5.4

1.0

12.7

12.0

34.9

0.4

0.2

1.7

14.8

-0.7

Standalone - Cash Flow Statement

Y/E March

OP/(Loss) before Tax

Depreciation

Interest & Finance Charges

Direct Taxes Paid

(Inc)/Dec in WC

CF from Operations

CF from Operating incl EO

(Inc)/Dec in FA

Free Cash Flow

CF from Investments

Inc/(Dec) in Debt

Interest Paid

Dividend Paid

CF from Fin. Activity

Inc/Dec of Cash

Opening Balance

Closing Balance

E: MOFSL estimates

FY16

6,688

1,829

402

-2,062

-650

6,208

6,027

-1,767

4,259

-1,877

-978

-1,208

-813

-2,972

1,178

4,352

5,529

FY17

7,378

1,791

-2,228

2,534

9,526

9,436

-1,052

8,384

-573

-4,329

-1,039

-1,017

-6,366

2,497

5,529

8,026

FY18

10,108

1,750

-381

-3,424

14,112

22,166

-3,331

18,835

-36,357

11,290

-354

-1,128

9,810

-4,381

8,026

3,645

FY19

12,028

1,800

1,598

-4,081

-3,229

8,116

-1,967

6,148

-1,965

-4,739

-2,192

-1,283

-8,213

-2,062

3,645

1,583

FY20

12,786

1,966

997

-1,699

373

14,423

14,496

-4,635

-7,414

-1,645

-1,357

-10,415

-627

1,583

957

FY21E

12,650

2,195

279

-3,162

-304

11,656

-3,000

8,656

-2,300

-979

-1,356

-2,335

7,022

957

7,978

FY22E

13,416

2,370

261

-3,381

693

13,359

-5,000

8,359

-4,282

-979

-1,356

-2,335

6,743

7,978

14,721

(INR m)

FY23E

14,173

2,603

322

-3,572

654

14,180

-7,000

7,180

-6,344

-979

-1,356

-2,335

5,502

14,721

20,223

18 November 2020

Gujarat State Petronet

NOTES

18 November 2020

Gujarat State Petronet

Explanation of Investment Rating

Investment Rating

Expected return (over 12-month)

BUY

>=15%

SELL

< - 10%

NEUTRAL

< - 10 % to 15%

UNDER REVIEW

Rating may undergo a change

NOT RATED

We have forward looking estimates for the stock but we refrain from assigning recommendation

*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within

following 30 days take appropriate measures to make the recommendation consistent with the investment rating legend.

Disclosures

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Motilal Oswal Financial Services Limited (MOFSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under

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Specific Disclosures

1 MOFSL, Research Analyst and/or his relatives does not have financial interest in the subject company, as they do not have equity holdings in the subject company.

2 MOFSL, Research Analyst and/or his relatives do not have actual/beneficial ownership of 1% or more securities in the subject company

3 MOFSL, Research Analyst and/or his relatives have not received compensation/other benefits from the subject company in the past 12 months

4 MOFSL, Research Analyst and/or his relatives do not have material conflict of interest in the subject company at the time of publication of research report

5 Research Analyst has not served as director/officer/employee in the subject company

6 MOFSL has not acted as a manager or co-manager of public offering of securities of the subject company in past 12 months

7 MOFSL has not received compensation for investment banking/ merchant banking/brokerage services from the subject company in the past 12 months

8 MOFSL has not received compensation for other than investment banking/merchant banking/brokerage services from the subject company in the past 12 months

9 MOFSL has not received any compensation or other benefits from third party in connection with the research report

10 MOFSL has not engaged in market making activity for the subject company

18 November 2020

Gujarat State Petronet

********************************************************************************************************************************

The associates of MOFSL may have:

- financial interest in the subject company

- actual/beneficial ownership of 1% or more securities in the subject company

- received compensation/other benefits from the subject company in the past 12 months

- other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the

specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even

though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report.

- acted as a manager or co-manager of public offering of securities of the subject company in past 12 months

- be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the

company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies)

- received compensation from the subject company in the past 12 months for investment banking / merchant banking / brokerage services or from other than said services.

The associates of MOFSL has not received any compensation or other benefits from third party in connection with the research report

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consider demat accounts which are opened in name of MOFSL for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from

clients which are not considered in above disclosures.

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The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the

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the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and

should not be treated as endorsement of the views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to make

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time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to

perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a

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Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022 71934200/ 022-71934263;

Website

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no.: L67190MH2005PLC153397.Correspondence Office Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road,

Malad(West), Mumbai- 400 064. Tel No: 022 7188 1000.

Registration Nos.: Motilal Oswal Financial Services Limited (MOFSL)*: INZ000158836(BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst:

INH000000412. AMFI: ARN - 146822; Investment Adviser: INA000007100; Insurance Corporate Agent: CA0579;PMS:INP000006712. Motilal Oswal Asset Management Company

Ltd. (MOAMC): PMS (Registration No.: INP000000670); PMS and Mutual Funds are offered through MOAMC which is group company of MOFSL. Motilal Oswal Wealth

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a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs,Insurance Products and IPOs.Real Estate is offered through Motilal Oswal Real Estate Investment Advisors II Pvt.

Ltd. which is a group company of MOFSL. Private Equity is offered through Motilal Oswal Private Equity Investment Advisors Pvt. Ltd which is a group company of MOFSL.

Research & Advisory services is backed by proper research. Please read the Risk Disclosure Document prescribed by the Stock Exchanges carefully before investing. There is no

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* MOSL has been amalgamated with Motilal Oswal Financial Services Limited (MOFSL) w.e.f August 21, 2018 pursuant to order dated July 30, 2018 issued by Hon'ble National

Company Law Tribunal, Mumbai Bench.

18 November 2020