1:2 Bonus Issue, Rs 5.50/Share Dividend: Buy Oil & Gas PSU, TP Rs 215: Motilal Oswal

Motilal Oswal has recommended investors to buy large cap PSU operating in gas & petroleum sector, GAIL (India) Ltd shares with target price of Rs 215. Current market price of GAIL shares on BSE is Rs 184.50 apiece with intraday decline of 2.15% at the time of writing the story (March 11, 2024). If you buy GAIL shares now at current market price of Rs 184.50 apiece, you can fetch potential gain of 16.53%. GAIL has already rewarded 1:2 bonus share in the year 2022 and recommended Rs 5.50 per share dividend in 2024. GAIL shares traded ex-dividend on February 6, 2024. GAIL stock offered returns of 31% in last 3-months and 66% in last 1-year. Check details below:

GAIL Shares Performance & Return Over Years: The 52-week high price of GAIL shares on BSE is Rs 196.35 apiece and 52-week low price is Rs 102.10 apiece, respectively. The company has a market capitalisation of Rs 1,21,376.34 crore. GAIL share offered investors return of 44% in last 6-months span, gained 87% in last 3-years, and jumped 57% in last 5-years. In last 10-years, GAIL shares soared 165%.

GAIL Q3 Results: State-owned GAIL on January 29, 2024 announced a surge of 18% in its quarterly profit as liquefied natural gas (LNG) prices softened from 2023. Its standalone profit for the quarter ended December 31, 2024 announced at Rs 2,842.62 crore as compared to Rs 2,404.89 crore in the corresponding quarter of last year. The PSU's revenue from operations surged nearly 8% to Rs 34,253.52 crore as compared to Rs 31,822.62 crore in Q2. GAIL's EBITDA stood at Rs 3,822 crore and margins improved 180 basis points to 11%.

GAIL Bonus Shares History: GAIL (India) Ltd offered shareholders 5 bonuses since October 6, 2008. GAIL's last bonus issue was declared in the proportion of 1:2 with it traded ex-bonus on September 6, 2022. In 2019, it announced bonus issue in 1:1 ratio, in 1:3 ratio in 2018, again in 1:3 ratio in 2017, and in 1:2 ratio in 2008.
GAIL Dividend History: GAIL (India) Ltd. announced 47 dividends since September 3, 2001. In the last 12 months, GAIL (India) announced an equity dividend amounting to Rs 9.50 per share. If current share price of Rs 184.40 is taken into consideration, GAIL (India) offers dividend yield of 5.12%.

Motilal Oswal Recommends buy Call: Motilal Oswal believes that better-than-expected performances in the gas transmission, LPG and petchem segments led to healthy quarterly earnings. Motilal anticipates a strong improvement in petchem segment's profitability over the second half of FY25- FY26. Motilal feels GAIL's return on equity (RoE) to get better to 15% in FY26 from 9.5% in FY23 with a healthy free cash flow generation.

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 Motilal Oswal, LKP Securities, and Sharekhan. 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.