Small cap stock worth investing for long term.

Indraprastha Gas Ltd:

Sole supplier of CNG, PNG and R-LNG in Delhi and other NCR cities. Current penetration is very low. Expanding fast to Faridabad, Sonepat, panipat, Noida and Ghaziabad. Risk free, no obsolescence and recession free business model. Ever expanding consumption and Industrial and residential customer base.This stock can be held for long term. It is ruling close to its yearly low of Rs. 101/-.It also offers an annual dividend yield of almost 4% on the current price of Rs.113/-. The stock is currently ruling below its intrinsic worth which is around Rs.135/- to 155/-. This stock is likely to give compounded annual rate of return of apprx.26% -30% p.a for the next ten years privided there is no change in the business model of the company.

Current market price as on 14.8.08, Rs. 113/-. F/y 2007-08 EPS is approx.Rs 12.5. EPS is expected to move up to Rs.16/- to Rs.17/- by 2010.

Expected market price range in the year 2009-10 is Rs. 200/- to 250/-.

Expected price range in the year 2010-2011 is Rs. 280/- to 325/-.

Expected price range during the year 2017-2018 is Rs.900/- to 1200/-.
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THE Hindu Business Line

IGL to invest Rs 500 cr, add 50 outlets:

New Delhi, Sept. 5, 2008

Indraprastha Gas Ltd plans to invest Rs 500 crore over next two years to expand its retail network. The company also plans to add 50 new outlets before the 2010 Commomwealth Games.

The IGL Managing Director, Mr Rajesh Vedvyas, told newspersons “We would be investing a total of Rs 250 crore this fiscal, with an investment of Rs 10 crore earmarked a station. All would be through internal accruals.”
Currently, IGL gets a little less than 2 million standard cubic metres a day (mmscmd) of gas at the administered price of $1.9 every million British thermal unit and has allocation for an additional 0.7 mmscmd.

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