We rate ADNOC Gas as a Neutral. Our DCF base-case 2030 generates a TP of 3.45 AED driven by a WACC of 8.7% (using UAE 10 YR bond of 4.5%, beta of 0.8x given flexible margin model and 5.5% ERP), terminal growth of 2.5% p.a and the following macro assumptions; (1) oil price at $64/b, real from 2027, (2) naphtha discount at -$5/b and propane/butane at -$20/b and (3) LNG prices linked to a 14% slope (to oil) in 2025 and 12% slope thereafter

We outline the key upside and downside risks that could impact our investment recommendation: 1) around half of the company's EBITDA is linked to oil prices, so an increase would be positive to earnings , 2) higher domestic demand and upstream production could boost the terminal growth rate, 3) negative revision to the feedstock contract would impact margins and returns and 4) new resources are challenging to develop (commercial and technical reasons), an inability to bring new volumes online would limit growth