Gail India - Maintain 'Hold' On Tempered Estimates: Nirmal Bang

Nirmal Bang Report

Cutting estimates on tempered gas marketing (trading) Ebitda due to lower crude. During our recent visit to GAIL India Ltd., we learnt that gas marketing earnings could get tempered vs the high in Q1 FY25, due to the recent dip in crude prices below $80/barrel of oil, versus the Q1 FY25 average of $85/bbl.

Hence we have cut our FY25E/FY26E gas marketing Ebitda by 25.2%/34.7%, and our FY25E/FY26E by 14.8%/12%. $70/bbl crude is positive for GAIL; $55-60/bbl is negative.

We have added FY27E and rolled over to September-26E. We have trimmed our crude forecast by 4.8%/5% in Q2 FY25/Q3 FY25 to $78/$73.5 per bbl due to the weakness in the global oil market.

We have cut our FY25E Brent crude forecast by 2.8% to $77.4/bbl, and left our FY26E unchanged at $65/bbl, while our FY27E crude forecast is at $62.2bbl.

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