January 20, 2017 / 12:55 PM IST
Motilal Oswal's research report on IOC Our channel checks suggest that the refinery clocked more than 1mmt of throughput in Dec-16, implying more than 80% utilization. All products have been certified and their commercial dispatches have commenced. Out of five sections of the Paradip-Raipur-Ranchi pipeline, except Ranchi segment, filling of all other segments has commenced recently. We expect product deliveries of 3-4mmtpa starting in next few days through the pipeline.
Outlook
Global peers are trading at 10.7x FY18 EPS and 6.8x FY18 EV/EBITDA. IOCL is trading at 8.7x FY18 EPS and 6.1x times FY18 EV/EBITDA. We value IOCL using SOTP. Refining and petrochem segments are valued at 5x FY19 EV/EBITDA, and marketing and pipeline segments at 7.5x FY19 EV/EBITDA. IOCL continues to remain our top pick with a target price of INR 464.
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