Moneycontrol PRO

Buy GAIL; target of Rs 125: Motilal Oswal

Motilal Oswal is bullish on GAIL recommended buy rating on the stock with a target price of Rs 125 in its research report dated May 20, 2023.

May 23, 2023 / 07:12 PM IST


  • bselive
  • nselive
Todays L/H

Motilal Oswal's research report on GAIL

GAIL reported EBITDA of INR3.1b in 4QFY23 (est. INR15.1b) due to high feedstock costs in petrochem segment and a weak performance in transmission segment due to one-off items. The transmission segment saw an adverse impact of ~INR8b in FY23 due to de-allocation of domestic gas for compressor fuel. This is not expected to continue going forward as GAIL has already represented the issue to PNGRB and recovery is expected to happen in subsequent tariff revision. Additionally, the management expects incremental benefits of INR15b in the transmission segment due to an increase in tariffs to INR58.6/mmBtu in FY24 from ~INR43/mmBtu in FY23. Transmission volumes are also expected to increase to 118mmscmd in FY24 from 107mmscmd in FY23.


The stock trades at a ~34% discount to its one-year forward long-term P/E average. By valuing the core business at 8x FY25E adjusted EPS of INR12.5 and adding the value of listed and unlisted investments of INR25, we arrive at a TP of INR125/share. We maintain BUY on the stock.

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on are their own, and not that of the website or its management. advises users to check with certified experts before taking any investment decisions.

GAIL - 22 -05 - 2023 - moti

Broker Research
first published: May 23, 2023 07:12 pm