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Informist, Saturday, May 23, 2026

By Simran Rede

MUMBAI – GAIL (India) Ltd. targets to spend INR 115 billion-INR 116 billion in capital expenditure in the financial year 2026-27 (Apr-Mar), the company's management said in its post-earnings analyst call for the March quarter. The company has raised its guidance for capex from INR 90 billion-INR 100 billion guided in the December quarter. 

It also expects to achieve a minimum profit before tax of INR 40 billion from the gas marketing segment for the financial year 2026-27 (Apr-Mar) if the West Asia war persists during the year. However, if the war normalises by the mid of the September quarter, then minimum profit before tax from this segment is expected to be INR 45 billion, the management added.

The company reported a 35% sequential fall in its gross earnings before interest, taxes, depreciation, and amortisation for the March quarter to INR 21.75 billion. This was primarily due to a decline in gas marketing margins, high input gas costs in the petrochemical segment, and higher provisions during the quarter which was partially offset by lower depreciation, the company's management said in the conference call.

The marketing segment of the company took a hit during the year due to multiple factors, including the geopolitical tensions, moderate weather conditions, pipeline disruptions, and the closure of the Strait of Hormuz, the company said. "All these factors caused disruption in the gas market and affected the demand and supply of natural gas in the country," it said.

Despite supply-chain disruption in March, the volume of GAIL (India)'s liquefied petroleum gas rose to 4.60 million tonnes in FY26 from 4.48 million tonnes in FY25. The company expects its LPG transmission volumes to be in the same range in FY27. On the compressed natural gas front, GAIL (India)'s subsidiary Gail Gas along with its joint ventures targets to add around 275 new CNG stations and about 400,000 new domestic piped natural gas connections. 

Going forward, the company expects natural gas likely to replace propane and LPG for usage in the industrial sector. It also sees natural gas replacing LPG for cooking in the kitchens in cities. "In conclusion, the Middle East conflict (West Asia war) and the Hormuz (Strait of Hormuz) closure have significantly disrupted the LNG industry. Recovery will happen gradually in phases," the company's management said.

With the commissioning of projects in Jamnagar, Jhasi, and Maharashtra, GAIL (India) expects its renewable energy portfolio to be more than 1 gigawatt by the end of next financial year, the management said. This will mark a significant jump from the present capacity of 153 megawatts.

In terms of fertilisers, the company has planned two fertiliser projects--one in Chhattisgarh and one in Maharashtra. It expects a capital expenditure of around INR 200 billion for both the projects. "So the plan is there and we are in discussions with the state governments to finalise the details. And I think very soon the initial front-end work on these projects will start," the company's official said in the conference call.

For the March quarter, GAIL (India)'s net profit fell over 38% to INR 12.62 billion. Its revenue from operations for the quarter fell nearly 3% on year to INR 347.97 billion. Friday, shares of the company closed over 3% higher at INR 160.77 on the National Stock Exchange.  End

Edited by Akul Nishant Akhoury

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