Accumulate GAIL - Emkay

GAIL Ltd
Reco: ACCUMULATE
CMP: Rs 368
Target Price: Rs 449

Better than Expected, Accumulate

- Results were above our estimate, with EBIDTA at Rs17.9bn and PAT at Rs10.9bn. Subsidy payout for Q3FY12 grew by 28% YoY to Rs5.3bn

- Revenue from natural gas transmission grew by 6.5% to Rs10bn, While trading business grew by 38% to Rs.82.7bn YoY, mainly on the back of higher spot LNG volume

- Sequentially, transmission and trading volume grew marginally by 0.3% to 119mmscmd and 1.2% to 85mmscmd respectively, mainly driven by higher offtake of spot LNG

- The recent news on proposed cap on gas marketing margin which is to be decided by PNGRB would keep the stock under pressure until any clarity emerges. Maintain accumulate with TP of Rs.449.

Source : Equity Bulls

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