Hold Gail (India); Target Of Rs 95: ICICI Direct
ICICI Direct recommended hold rating on Gail (India) with a target price of Rs 95 in its research report dated November 12, 2020.
Nov 17, 2020 / 12:42 PM IST
ICICI Direct's research report on Gail (India)
Gail India reported better than estimated results for Q2FY21 on the profitability front. The profitability of gas transmission and petchem came in above our estimates on an operational basis while gas trading segment results were below estimates. Revenues for the quarter declined 24.4% YoY to Rs 13642.7 crore. Hence, EBITDA at Rs 1338.1 crore (down 14.4% YoY), came in above our estimates of Rs 1153.2 crore. Reported PAT at Rs 1239.7 crore (up 16.5% YoY) was above our estimate of Rs 756.6 crore.
We value Gail using the SOTP methodology, valuing the core business using DCF and EV/EBITDA multiple for other business segments and change our rating from REDUCE to HOLD with a revised target price of Rs 95.
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