GAIL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.6
| Stock Code | GAIL | Market Cap | 1,07,325 Cr. | Current Price | 163 ₹ | High / Low | 203 ₹ |
| Stock P/E | 13.8 | Book Value | 112 ₹ | Dividend Yield | 4.59 % | ROCE | 15.3 % |
| ROE | 14.1 % | Face Value | 10.0 ₹ | DMA 50 | 157 ₹ | DMA 200 | 168 ₹ |
| Chg in FII Hold | -1.03 % | Chg in DII Hold | 0.74 % | PAT Qtr | 1,603 Cr. | PAT Prev Qtr | 2,217 Cr. |
| RSI | 61.5 | MACD | 4.04 | Volume | 78,41,736 | Avg Vol 1Wk | 1,02,75,784 |
| Low price | 134 ₹ | High price | 203 ₹ | PEG Ratio | -4.79 | Debt to equity | 0.26 |
| 52w Index | 42.2 % | Qtr Profit Var | -19.5 % | EPS | 11.8 ₹ | Industry PE | 15.3 |
Financials & Valuation:
GAIL shows balanced fundamentals. ROCE (15.3%) and ROE (14.1%) reflect solid efficiency. EPS of 11.8 ₹ supports profitability, though quarterly PAT declined to 1,603 Cr. from 2,217 Cr., showing earnings pressure. Debt-to-equity at 0.26 is low, ensuring financial stability.
Valuation Indicators:
P/E ratio of 13.8 is slightly below the industry average (15.3), suggesting fair valuation. Book Value of 112 ₹ compared to current price of 163 ₹ shows moderate premium pricing. PEG ratio of -4.79 indicates weak earnings growth outlook. Dividend yield of 4.59% provides strong income support.
Business Model & Health:
GAIL, India’s leading natural gas company, benefits from strong demand in energy and infrastructure. Profitability metrics are decent, supported by dividend yield and efficiency ratios. Institutional sentiment is mixed, with FII holdings declining (-1.03%) and DII holdings increasing (+0.74%).
Entry Zone & Holding Guidance:
Technically, support lies around 155–165 ₹, with resistance near 175–185 ₹. Entry near support levels offers favorable risk-reward. Long-term holding is recommended given strong fundamentals and dividend yield, though earnings volatility should be monitored.
Positive
- Strong dividend yield (4.59%).
- ROCE (15.3%) and ROE (14.1%) show solid efficiency.
- EPS of 11.8 ₹ supports profitability.
- DII holdings increased (+0.74%).
Limitation
- PEG ratio (-4.79) indicates weak growth outlook.
- Quarterly PAT declined (1,603 Cr. vs 2,217 Cr.).
- FII holdings decreased (-1.03%).
- Earnings volatility raises caution.
Company Negative News
- Decline in quarterly PAT.
- Reduction in FII holdings.
- Weak earnings growth outlook.
Company Positive News
- DII holdings increased, reflecting domestic support.
- Dividend yield remains strong.
- EPS continues to support profitability.
Industry
- Energy and natural gas sector benefits from infrastructure expansion and rising demand.
- Industry PE (15.3) aligns closely with GAIL, supporting fair valuation.
- Long-term growth supported by energy transition and government initiatives.
Conclusion
GAIL is moderately strong with solid efficiency, strong dividend yield, and fair valuation. Entry near 155–165 ₹ offers a favorable setup. Long-term investors can hold with confidence, while monitoring earnings volatility and institutional sentiment.
Would you like me to extend this into a sector overlay comparison against peers like ONGC, Petronet LNG, and Indian Oil to highlight GAIL’s relative positioning in valuation, dividend yield, and profitability?