GAIL India share price added 1 percent in the morning trade on June 11 as broking houses raised the target price after strong March quarter numbers.
The company posted a 28.3 percent rise in its Q4 net profit at Rs 1,908 crore against Rs 1,487.3 crore in Q3FY21. Its revenue was down at Rs 15,449 crore against Rs 15,454.3 crore.
Earnings before interest, tax, depreciation and amortization (EBITDA) were up 28.4 percent at Rs 2,465 crore and the margin was up at 16 percent (QoQ)
Here is what brokerages have to say about the stock and the company after the March quarter earnings:
Motilal Oswal | Rating: Buy | Target: Rs 210
With ever-increasing gas demand in India, transmission pipelines would play a critical role in connecting both imported and domestically produced gas with consumers. This would encourage the development of new pipeline infrastructure in the country.
Despite the outperformance of around 20 percent in CY21 till date, the stock trades at a discount of around 22 percent to its one-year forward long-term P/E average.
Sharekhan | Rating: Buy | Target: Rs 196
We have increased our FY2022-FY2023 earnings estimates to factor improved profitability for the petrochemical and LPG-LHC business.
Despite the recent run up, GAIL’s valuation of 7x its FY2023E EV/EBITDA is attractive and we expect the company to be the key beneficiary of the government’s aim to increase the share of gas in India’s energy mix, as the same provides a sustainable volume growth opportunity for its gas pipeline and trading business.
Prabhudas Lilladher | Rating: Buy | Target: Rs 184
We increase our FY22/23E earnings by 10.8 percent/1.7 percent to incorporate higher petrochemicals and LPG realisation. Sharp recovery in commodity prices in-line with recovering economy, augurs well for GAIL.
The commissioning of new pipelines over the next year will augment volumes and profits. We had put the rating under review after a sharp run up in stock prices and now have a “buy” rating with a price target of Rs 184 based on 7x EV/E FY23E.
CLSA | Rating: Buy | Target: Raised to Rs 200
Confident of improved performance in FY22 as LNG price has spiked. CLSA has raised the FY22-23 EPS estimate by 2-3 percent.
The positive leverage to crude, receding worries on gas trading are the positives. The volume tailwinds in core gas transmission are also a key positive.
Credit Suisse | Rating: Neutral | Target: Raised to Rs 165
The broking house raises FY22/23 EPS estimates by 13 percent/1 percent. It stays neutral as stock is already reflecting the benefit of crude prices.
At 0929 hours, GAIL India was quoting at Rs 165.20, up Rs 1.75, or 1.07 percent, on the BSE.
The share touched a 52-week high of Rs 170 on June 9, 2021 and a 52-week low of Rs 81.25 on October 14, 2020. It is trading 2.82 percent below its 52-week high and 103.32 percent above its 52-week low.Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.