GAIL Q1 Results Review - Robust Quarter Driven By Marketing, Transmission Volumes: Centrum

Centrum Report

GAIL (India) Ltd. reported strong operating performance in Q1, with Ebitda and profit after tax increasing 24.5% and 28.7% QoQ, reaching Rs 47.9 billion and Rs 31.8 billion, respectively. Volumes declined across all the segments except the natural gas transmission.

Natural gas transmission margins and gas marketing margins drove robust performance despite weak performance from the petrochemicals segment. In Q1, natural gas transmission volumes rose 6.6% QoQ to 131.8 million metric standard cubic meters per day, while natural gas marketing volumes declined marginally by 0.4% QoQ to 99.5 mmscmd.

Petrochemical segment underperformed, with production volumes falling by 34.7% QoQ to 162,000 million tonne. LPG and Liquid Hydrocarbons segment also saw a 4.4% QoQ decline in volumes. With existing LNG contracts, management has guided for gas transmission volumes of 130- 132 mmscmd for FY25E and 140-142 mmscmd for FY26E.

Currently, we have kept our estimates unchanged and continue to maintain a 'Sell' rating with a SOTP based unchanged target price of Rs 148.

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