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Informist, Monday, Oct. 27, 2025

By Sunil Raghu

AHMEDABAD – GAIL (India) Ltd. is expected to report a double-digit year-on-year fall in its net profit for the September quarter due to muted growth in gas transmission and marketing volumes and weak margins in petrochemicals as well as the liquefied petroleum gas business, brokerages said.

GAIL's net profit for the September quarter is expected to fall almost 22% on year to INR 21 billion, according to the average of estimates by 11 brokerages. The estimates range from INR 18 billion by ICICI Securities Ltd. to INR 23 billion by HDFC Securities Ltd.

The company's revenue from operations for the quarter is expected to rise 5.6% on year to INR 347.7 billion, according to the average of these estimates. The lowest estimate for the top line is INR 318 billion by HDFC Securities and the highest is INR 359.6 billion by Prabhudas Lilladher Pvt. Ltd.

GAIL operates two-thirds of India's gas pipeline infrastructure spread across 20 states. It owns and operates over 16,000 km of natural gas pipelines, with a capacity of 204 million standard cubic metres per day.

Predominantly a natural gas player, the company also operates in the petrochemicals segment, producing polymers as high-density polyethylene, linear low-density polyethylene, and polypropylene from its gas-based plants. The combined polymer capacity of GAIL is around 1.4 million tonnes per annum and accounted for nearly 5% of company's total annual revenue in 2024-25 (Apr-Mar). The company also markets LPG across India under the 'GAIL Gas' brand and produces a little less than a million tonnes of LPG annually. The company will announce its quarterly results for Jul-Sept Thursday.

GAIL's earnings before interest, taxes, depreciation, and amortisation for the September quarter is expected to be at INR 32.1 billion, as per the average from estimates of 11 brokerages. Systematix Shares and Stocks Ltd.'s estimate of INR 30.5 billion for the EBITDA is the lowest, while YES Securities (India) Ltd.'s forecast of INR 35.3 billion is the highest. Brokerages expect GAIL's Jul-Sept EBITDA to contract 3% on quarter, led by a decline in its gas transmission, marketing business and weak LPG business. HDFC Securities expects GAIL's September quarter EBITDA at INR 32 billion.

Most brokerages expect GAIL to see either flat or modest growth in its gas transmission volumes, compared to the year-ago quarter. "GAIL is expected to witness tepid growth in transmission from 121 million standard cubic meters per day to 123 mscmd a quarter ago," Prabhudas Lilladher said in a note. It also expects performance of petrochemicals and LPG segments to remain weak.

As per publically available information, the company's LPG and petrochemicals margins for the September quarter were hit due to reduced availability of government-regulated feedstock – domestic natural gas. Cheaper domestic gas is a key feedstock for making LPG and for GAIL's petrochemicals business.

At 1128 IST, shares of the company were trading marginally lower on the National Stock Exchange at INR 180.86. GAIL's stock has remained largely flat since the company reported its June quarter earnings on Jul. 28.

Of the 16 brokerage reports on the company available with Informist, 13 have a 'buy' rating on GAIL with an average target price of INR 222 per share. Three have a 'hold' call and one has recommended selling the scrip.

The following are Jul-Sept. earnings estimates for GAIL India from 11 brokerages in descending order by the estimate of net profit, in INR million:

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Edited by Nishant Maher

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