loading
loading
Gas PSU stock to buy: Brokerage firm Emkay Global has upgraded gas PSU stock GAIL (India) to ‘buy’ from ‘add’, on the back of a steady core business and earnings outlook along with attractive valuations. The brokerage firm has given the target price of ₹200, seeing an upside potential up to 15.6%. According to the firm, despite the Strait of Hormuz crisis and elevated LNG prices, India’s gas demand has improved sequentially in 2QFY27, with demand in July-August 2026 declining only 2% year-on-year. Consequently, GAIL’s gas transmission volumes are expected to improve quarter-on-quarter and could exceed the company’s FY27 guidance of 123 mmscmd. While gas marketing profitability is likely to moderate sequentially as formula-based trailing averages normalize, the FY27 guidance of ₹40-45 billion could still see a significant beat, supported by stable Henry Hub settlement prices and continued strength in crude oil and spot LNG prices. “We build in Brent at $85/bbl, though the 1HFY27 average is likely to be $100/bbl; hence there is a potential upside to our estimates,” the firm said. It further added that the petrochemical segment is also expected to deliver improved EBITDA sequentially, with plant utilisation likely to remain close to full capacity. “We slightly raise FY27-29E EPS by 2-3% each, updating the FY26 annual report data, and rollover to Sep-28E earnings. GAIL Gas’s IPO RFP has already been released and a potential listing next year can lead to value unlocking of its wide CGD interest. We conservatively value unlisted investments at 1x PBV,” it said. GAIL’s medium-term outlook is stable, as gas transmission volumes will continue growing structurally, with increasing share of volumes in higher-tariff bid pipelines, the firm said. GAIL’s upcoming petrochemical projects could emerge as an additional growth driver. The Mangalore PTA and Usar PDH-PP projects are expected to be commissioned over the next 1–1.5 years. However, Emkay has not included any earnings contribution from these projects in its estimates, even though the associated capital expenditure has been factored in. The brokerage also pointed to GAIL’s plans to foray into the fertiliser segment through two urea projects with a combined capacity of around 2.5 million tonnes per annum along the Mumbai-Nagpur-Jharsuguda pipeline. These projects are expected to generate assured returns of 12–16% and provide anchor gas volumes of around 4–5 mmscmd for the pipeline. GAIL (India) stock has remained under pressure in the near term, declining 0.69% over the past week and 1.60% in the last one month. However, the stock has given 26% returns in the last six months. Furthermore, the stock has delivered a largely flat performance so far in 2026, with a marginal 0.54% gain on a year-to-date basis. Over a one-year period, GAIL shares have declined 0.99%, indicating that the stock has struggled to generate positive returns in the medium term. However, the company’s longer-term performance has been stronger, with the stock gaining 41.09% over three years. Looking at the broader level, GAIL has delivered a 69.76% returns in the last five years. Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions. Vaamanaa covers business and stock market news. Started in 2020, she has been producing news on digital platforms for over 4.5 years now. She writes on markets, commodities, IPOs, and industry. She has worked for news channels like Jagran New Media and Business Insider India. You can reach out to her at vaamanaa.sethi@htdigital.in. Catch all the Business News , Market News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates. Oops! Looks like you have exceeded the limit to bookmark the image. Remove some to bookmark this image.
document fetched 2026-09-28 02:55 · canonical https://livemint.com/market/stock-market-news/gas-psu-stock-to-buy-emkay-global-sees-further-16-upside-in-gail-india-share-price-target-stop-loss-rationale-11790492517022.html