Maharatna stocks gets a Buy call with an upside potential of 19%; Check the details

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Maharatna stocks gets a Buy call with an upside potential of 19%; Check the details

In the last six months, the shares of Maharatna-status GAIL (NS: GAIL ) (India) Ltd. have generated an impressive 22% gain for its shareholders advancing from Rs 86 to Rs 105 at present. This is much better than what the broader market has returned. During the same period, the benchmark NIFTY 50 index has traded almost flat with a marginal 0.95% or 164 points decline to 17,162 points.

Owned by the Ministry of Petroleum and Natural Gas, Government of India, GAIL is a gas transmission & marketing, gas exploration & production, petrochemicals, renewables, and city gas distribution company.

The CPSU came into focus recently when the Petroleum and Natural Gas Regulatory Board (PNGRB) announced that it has increased the tariff for nine inter-connected pipelines of GAIL to INR 58.6/mmbtu from INR 45/mmbtu. These nine pipelines account for almost 90% of the volume of the gas company.

Analysts at the Antique Stock Broking opinionated, “GAIL will likely get its tariff reassessed higher post the KP Committee report, which is likely to be approved by the Cabinet in the coming week and we incorporate the same in our FY25 estimates.”

Brokerages have maintained a positive outlook on this CPSU stock with some initiating buy coverage while others increasing their target prices.

GAIL (India) reported a sharp 90% fall in its consolidated net profit for the three-month quarter ending December 2022 (Q3FY23). The losses of its petrochemical and natural gas marketing division brought down the overall net profit to Rs 397.59 crore during the period from Rs 3,800.09 crore it had earned during the same period (Q3FY22) last year.

The decline in the bottom line happened despite the 37% rise in its revenue from Rs 26,145 crore in Q3FY22 to Rs 35,885 crore in Q3FY23.

In line with these developments, the domestic brokerage firm JM Financial (NS: JMSH ) has given a target price of Rs 125 per share for the stock. This translates into a potential 19% upside for the investors.

Written by Vikalp Mishra

The post Maharatna stocks gets a Buy call with an upside potential of 19%; Check the details appeared first on Trade Brains.

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