Motilal Oswal's research report on GAIL
GAIL’s 1QFY26 EBITDA/PAT came in 7%/9% below our estimates at INR33.3b/INR18.9b, as petchem and LPG segments delivered weak performance. 1QFY26 revenue included a one-time settlement gain of ~INR1.3b related to past differential tariff adjustments. EBITDA/PAT, adjusted for the settlement gain, came in 11%/15% below our estimates. While natural gas (NG) transmission volumes stood below our estimate at ~121mmscmd, EBIT, adjusted for the settlement gain, stood in line with our estimate. NG marketing volume was in line with our estimate at 105mmscmd. Petchem sales were above our estimate at 177tmt, while the petchem segment reported an EBIT loss of INR2.5b.
Outlook
We reiterate our BUY rating on GAIL with an SoTP-based TP of INR210. During FY25-27, we estimate a 2% CAGR in PAT as we build in:
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