Good Company from Utilities Non-electric segment. GAIL Limited is a government owned natural gas corporation responsible for natural gas processing and distribution in India. Gail was making revenue and profits of 10,000 Cr & 1000 Cr respectively during 2001. Today they are able to generate revenue and profits of 77000 Cr and 6500 Cr Profits Respectively. Growth of around 7X. Long history of Rich cash flow and profit making. Many people in the group have accumulated Gail near 80 just a few months back, no need to worry. We may see this company move towards landmark sale of 1 Lakh Cr in 2026.
Last Year revenue and profits have fallen with the impact of Covid as sales were down by -21% & Profits by -35%. As overall auto industry was affected more during 2019-2020 sales of GAIL also were affected. Their 80% sales comes from Natural gas Marketing. Hence we have not seen lifetime high sales & Even Profits for the past 2 years. We were expecting recovery this year. New buying again have been recomended near 125 (upgraded from 100 last quarter) and target this year was 190 where Some 10% Profits can be booked.
Considering Q1 results which were fantastic due to increased mobility again we saw the sales growth of 44% on the back of 45% growth in Natural Gas Marketing. Hence again profit have skyrocketed with the growth of 235%. It seems GAIL is back on the track again towards life time high sales, Profits tthis year and hence Investors may see lifetime high price also this year. Multiyear rally could be expected in the next decade but growth could be around 10%. This is the turnaournd story after 2 years of muted phase, hence stocks is still trading below FAIRVALUE and New buying can be done 130 or SIP could be done in current situation also all with target of 190 in the next few months. The Company with high dividend Yield.
Lic has just bought around 9 Cr shares during last February to July near 100, your buying near 80 is no doubt better than LIC. Pays around 25% profits in dividends and hence investment if done 2 decades back has returned 2x through dividends. 52% Promoter Holding, while 16% MF & Insurance companies along with 19% FII.
Fairvalue can be seen here: