Buy Large Cap PSU Maharatna Gas Stock, TP Price Rs 151: Prabhudas Lilladher Upgrades

Leading brokerage firm Prabhudas Lilladher has upgraded target price of large cap PSU gas stock GAIL (India) Ltd and recommended buy call. Current market price of GAIL share is Rs 124.55 and if you buy GAIL stock at this price keeping in view of the target price of Rs 151, you can fetch potential gain of 21.24%. GAIL shares witnessed gain of 16% in last 6-months and soared 37% in last 1-year. Check details below:

GAIL (India) Valuation: According to Swarnendu Bhushan, Co-Head of Research, Prabhudas Lilladher Pvt Ltd, "We maintain 'Buy' rating on GAIL, driven by strong transmission and trading segments with TP of Rs151 (earlier Rs139) based on 10x FY26 EPS of 12.7 and value of listed and unlisted investments at Rs24. For IOCL, we maintain 'Hold' rating with TP of Rs94 (unchanged) based on 0.7x FY26 P/BV."

Global PP demand for FY23 is projected at ~90 mmt, out of which China accounts for 40%. Similarly, global demand for PE is projected at ~118 mmt, out of which China accounts for 34%. Current PE/PP spreads are at lower end of last decade and are expected to remain weak going ahead too, added the analyst.

GAIL (India) Stock Performance & Return: Current market price of GAIL (India) share BSE is Rs 124.55 per share with intraday gain of 0.61%. Its 52-week high price is Rs 132.45 per share and 52-week low price is Rs 90.00 per share, respectively.

GAIL (India) Financials: The state-run company declared a surge of 56% in its standalone profit for the quarter ended September 2023 to Rs 2405 crore as compared to Rs 1537.07 crore in the corresponding period of last year. But, it reported a decline pf 17.32% in its total revenue to Rs 31,822 crore as against Rs 38,490.89 crore in the similar period of last fiscal. The PSU gas company announced a rise of 67% in its profit before tax to Rs 3130.10 crore in Q2 of current fiscal as against Rs 1875.91 crore in the corresponding period of last year. The company's earnings per share soared to Rs 3.66 in Q2 from Rs 2.34 in September 2022 quarter.

About GAIL (India) Ltd: It was incorporated in August 1984 as a Central Public Sector Undertaking (PSU) under the Ministry of Petroleum & Natural Gas (MoP&NG). The company was initially given the responsibility of construction, operation & maintenance of the Hazira - Vijaypur -Jagdishpur (HVJ) pipeline Project. It was one of the largest cross-country natural gas pipeline projects in the world. Originally this 1800 Km long pipeline was built at a cost of Rs 1700 Crores and it laid the foundation for development of market for natural Gas in India. Government approved grant of Maharatna status to Gas Authority of India Ltd. (GAIL). This decision was communicated on 1st February, 2013.

Disclaimer

The stock has been picked from the brokerage report of Prabhudas Lilladher. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.