GAIL India Shares Jump 6% After Q4 Results; Brokerages See Up To 18% Upside
New Delhi, May 25: Shares of GAIL (India) Limited rose sharply on Monday after the state-owned natural gas major reported its financial results for the January–March quarter of FY26. Investors reacted positively despite a decline in quarterly profits and operating margins.
The stock climbed more than 6 per cent during intraday trade on the National Stock Exchange (NSE), touching a high of ₹170.7 before trading around ₹168 levels.
GAIL Reports Mixed Q4 FY26 Performance
For the March 2026 quarter, GAIL reported revenue from operations of ₹35,705 crore, slightly higher than ₹35,303 crore in the previous quarter.
However, earnings before interest, tax, depreciation, and amortisation (EBITDA) declined to ₹2,703 crore from ₹3,610 crore quarter-on-quarter. Profit after tax (PAT), excluding minority interest, also fell to ₹1,485 crore compared to ₹1,756 crore in Q3 FY26.
On a standalone basis, net profit dropped 21 per cent sequentially to ₹1,262 crore, while EBITDA plunged 56.5 per cent due to weaker margins and pressure across several business segments.
Margins Under Pressure
The company’s EBITDA margin contracted sharply to 3.31 per cent from 7.79 per cent in the previous quarter.
Analysts attributed the weaker profitability to challenges in the petrochemical business, softer product realisations, higher gas costs, and losses in the marketing segment linked to forex liabilities and provisions on receivables.
Despite this, gas transmission volumes remained strong and exceeded analyst expectations.
Dividend Announcement Boosts Sentiment
GAIL’s board recommended a final dividend of ₹0.50 per equity share for FY26, subject to shareholder approval.
This comes in addition to the interim dividend of ₹5 per share already announced earlier, taking the total dividend payout ratio for the year to nearly 52 per cent.
The strong dividend payout supported investor confidence in the stock.
Brokerages Remain Bullish On GAIL
Brokerages maintained a positive stance on the company despite the mixed quarterly numbers.
Motilal Oswal Financial Services retained its “Buy” rating on GAIL with a target price of ₹184, citing attractive valuations, healthy free cash flow, and stable gas transmission growth prospects.
The brokerage highlighted that management expects FY27 gas transmission volumes to remain around 115 mmscmd, with potential upside if geopolitical conditions improve.
Meanwhile, JM Financial also maintained a “Buy” rating while revising its target price slightly lower to ₹190 from ₹195.
Analysts noted that stronger gas transmission earnings and stable LNG pricing trends continue to support the company’s long-term outlook.
Focus On Expansion And Infrastructure
During FY26, GAIL invested ₹9,594 crore in capital expenditure, mainly towards pipeline infrastructure, petrochemical projects, and operational expansion.
The company also expanded its CNG network through its subsidiary GAIL Gas, adding 88 new stations during the year, with further expansion planned over the next two years.
What Investors Will Watch Next
Going forward, investors are expected to closely monitor progress in GAIL’s petrochemical projects, proposed fertiliser ventures, gas transmission tariffs, and recovery in operating margins.
While short-term earnings pressure remains a concern, analysts believe the stock continues to offer value due to its strong market position, infrastructure expansion plans, and consistent dividend support.
