Shares of GAIL (India) rose sharply in early trade on Tuesday despite a steep year-on-year decline in December-quarter profit, before paring gains later in the session.
The stock climbed nearly 4 per cent to ₹166.49 on the NSE from its previous close of ₹160.39, but at 11.39 am was trading almost flat at ₹161.80.
The state-run gas utility reported a 58.5 per cent fall in standalone net profit for the quarter ended December 2025 to ₹1,602.57 crore, compared with ₹3,867.38 crore in the same period last year.
Revenue from operations slipped about 2.5 per cent to ₹34,075.81 crore in Q3FY26 from ₹34,957.76 crore a year earlier.
Brokerages attributed the weaker earnings primarily to softness in gas trading margins and continued pressure in the petrochemicals segment, partly offset by better performance in gas transmission.
JM Financial said GAIL’s standalone EBITDA at ₹26.6 billion came in below its estimate and consensus due to sharply lower profitability in gas trading and a steep fall in petchem earnings.
This was partially cushioned by stronger gas transmission EBITDA, helped by lower operating costs and slightly higher volumes, as well as better-than-expected performance in the LPG pipeline business.
The brokerage maintained its buy call while revising its target price to ₹205, citing expectations of steady growth in transmission volumes and sustained trading profitability over the medium term.
HDFC Securities, retained a buy rating at ₹196, even though the reported EBITDA and adjusted profit after tax were below its estimates. It said GAIL’s ability to defend gas marketing margins amid rising gas costs and a recovery in transmission volumes underpins its positive stance, while noting that petrochemical profitability remained a drag during the quarter.
Motilal Oswal reiterated its buy at target price of ₹190, projecting a 19 per cent compound annual growth in profit over FY26–28. The brokerage expects this to be driven by higher gas transmission volumes, improved performance in the petrochemical business as new capacity comes on stream and spreads recover, and healthy profitability in the trading segment. It also forecast return on equity stabilising above 12.5 per cent and strong free cash flow generation over the period.
Nuvama Institutional Equities, however, struck a cautious note, highlighting delays in tariff hikes and a prolonged downcycle in petrochemicals. The brokerage said GAIL’s Q3 EBITDA missed consensus expectations mainly because of weaker petchem earnings, while transmission volumes were flat year on year. It cut its FY27 and FY28 estimates and maintained a reduce rating with a target price of ₹151.
Published on February 3, 2026
