Dolat Capital recommended accumulate rating on GAIL (India) with a target price of Rs 422 in its research report dated November 12, 2018.
Dolat Capital's research report on GAIL (India)
GAIL Q2FY19 numbers were ahead of estimates mainly driven by higher realizations and strong performance in the gas transmission and trading segments. Higher pipeline tariffs for some of the pipelines and a onetime settlement of ` 1.3 bn boosted profitability. Gas trading volume grew by 14% due to the spread expansion in Henry Hub and spot LNG prices. Volume outlook on gas transmission looks stable driven by the increase in gas availability and addition of Kochi Mangalore Pipeline. Long pending tariff for GAIL main pipelines is another key trigger. Reiterate our Accumulate recommendation with a target price of ` 422.
With key trigger of pipeline tariff hike likely to go through in next 2 quarters and GAIL adding pipeline capacity, volume and profitability outlook gets better. We Reiterate our Accumulate recommendation with a target price of ` 422.
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