Investec has a "buy" recommendation on Petronet LNG with a price target of ₹400 per share, implying an upside potential of nearly 44% from its previous
close.
The brokerage note said that global liquefied natural gas (LNG) supply is set to increase sharply in 2026 by 7% or 40 bcm (Billion Cubic Meters), which will be its fastest growth since 2019. This surge will be driven primarily by the US, Canada, Qatar and African producers, Investec added.
Spot prices are currently under pressure with supply far exceeding demand, and this benign pricing environment, according to Investec, comes at an opportune time for India.
India's LNG imports fell in financial year 2025 due to temporary factors which are now stabilising, Investec said, adding that these lower spot prices should help revive price-sensitive industrial demand from the start of next year.
Petronet's plans to expand its Dahej plant capacity to 22.5 MMTPA is now complete and the current contracted volumes provide strong downside protection, as per Investec. Superior connectivity should also help the company capture incremental spot volumes as prices soften.
After an 18% correction over the past year on cyclical import weakness, Petronet LNG now trades below its historical valuations, Investec said.
Of the 34 analysts that have coverage on the stock, 15 have a "buy" rating, 10 have a "hold" rating and nine have a "sell" rating.
Shares of Petronet LNG are trading 1% higher on Tuesday at ₹281.1. The stock is down 20% so far this year.
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