GAIL Shares Soar With Tariff Increase Hope, CLSA Increases Target Price

GAIL (India) Ltd. shares surged more than 5% on April 21, 2025, on hopes of a possible tariff revision by the Petroleum and Natural Gas Regulatory Board (PNGRB). The regulator issued a consultation paper examining tariffs on 10 of GAIL's pipelines, leading to investor hopes of a possible revision upward of transmission charges.

 

Key Highlights:

 

✅ Tariff Review Process: PNGRB is considering GAIL's submitted levelized tariff of ₹78.72 per MMBtu, higher than the existing ₹59 per MMBtu.

✅ Stock Performance: GAIL shares jumped 4.33% intraday, closing at ₹195.05, a positive sign for investors.

✅ Brokerage Upgrade: CLSA upgraded GAIL's rating from 'Hold' to 'Outperform', increasing its target price to ₹210 per share.

✅ Earnings Forecast: CLSA upgraded GAIL's earnings per share (EPS) estimate by 9–19%, expecting a 20–25% tariff increase by June.

✅ Market Impact: Experts opine that even a half tariff increase to ₹70 per MMBtu would be extremely positive, considering GAIL's large pipeline network.

 

With increasing natural gas demand and infrastructure growth, a tariff revision could substantially increase GAIL's revenue, strengthening its market position.

 

Source: Zee Business, NiftyTrader, LiveMint