PSU Stock Exhibiting Strong Upward Trend, TP Rs 200: 3 Brokerages Recommend Buy

Three brokerages have recommended buy call to large cap gas & petroleum sector PSU, GAIL (India) Ltd shares. Current market price of GAIL shares on BSE is Rs 182.45 apiece with intraday fall of 0.95% as on Feb 17, 2024.

GAIL shares offered return of 60% in last 6-months. LKP Securities, Sharekhan, and Motilal Oswal have suggested investors to buy GAIL India shares. Check details below:

GAIL Q3 Results: The state-owned company and India's largest gas distributor on January 29, 2024 declared a rally 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 declared at Rs 2,842.62 crore as against Rs 2,404.89 crore in the preceding September quarter. The PSU's revenue from operations soared approximately 8% to Rs 34,253.52 crore as compared to Rs 31,822.62 crore in Q2. GAIL's EBITDA declared at Rs 3,822 crore and margins surged 180 basis points to 11%.

GAIL Dividend: The company also recommended an interim dividend of Rs 5.50 per equity share amounting to Rs 3,616.30 crore. The dividend was paid on February 6, 2024. It is worth mentioning here that GAIL announced 47 dividends since September 3, 2001. In the last 12 months, GAIL announced an equity dividend amounting to Rs 9.50 per share. If the last trading price of 182.45 is taken into consideration, it offers a dividend yield of 5.20%.

LKP Securities Recommends Buy: Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities has recommended buy rating to GAIL shares as it is displaying robust upward trend. The analyst feels GAIL shares displaying the potential of reaching an upside target of Rs 190-200 per share in the near term.
Sharekhan Suggests Buy Call: Sharekhan has also assigned buy rating to GAIL stock with revised target price of Rs 200 apiece. The analyst feels GAIL to declare a strong earnings recovery across its business segments supported by stabilising global LNG supplies.

Motilal Oswal Recommends buy Call: The noted analyst feels 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. The brokerage firm has issued buy call for GAIL shares and increased the target price to Rs 200 per share.

GAIL Shares Performance & Return: The 52-week high price of GAIL shares on BSE is Rs 186.50 apiece and 52-week low price is Rs 93.15 apiece, respectively. The company has a market capitalisation of Rs 1,19,962.69 crore. GAIL shares offered shareholders return of 5.46% in last 1-week, soared 44% in last 3-months, gained 90% in last 1-year, and offered return of 105% in last 3-years.

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.