**GAIL– Q3 FY20 (Un Audited –Cons)**
CMP: 3252
Total revenue from operations at 17,899 Cr
20,229 Cr (-11.82%) YoY | 18,250 Cr (-1.92%) QoQ
Nine Months ending revenue: 54,629 Cr Vs. 57,156 Cr (-4.41%)
Net Profit of 2,029 Cr
1,797 Cr (12.91%) YoY 1,168 Cr (73.79%) QoQ
Nine Months ending Net profit: 4,701 Cr Vs. 5,029 Cr (-6.53%)
EPS (in Rs.) 4.49
3.98 YoY | 2.59 QoQ
Nine Months ending EPS: 10.41 Vs. 11.14
View: Result is in line with the expectation. Although YoY and QoQ revenue declined but profit up in YoY and QoQ due to Tax reduction impact.
**Business Updates & Highlights**:
Earnings before interest, tax, depreciation, and amortisation rose 32.6 percent to Rs 2,072.4 crore, while operating margin expanded to 11.7% from 8.7% in the preceding quarter.
**Board of Directors of the Company at its Meeting held on February 10, 2020, inter alia, has declared the payment of Interim Dividend @ 64% (Rs. 6.40 Per share) on the paid-up equity share capital of the Company for the FY 2019-20.**
ROE and ROCE is around INR 11.4% and 22% respectively and book value per share is around INR 100 and share is currently trading at 1.1x of its book value. Company is currently trading at annualized PE of around 8.5 which is fair as per Industry benchmark. Promoter holding is around 52.1% in the company which is good. FIIs and mutual fund hold around 17.8%, and 10.2% in the company.
**Share View**: Share price high 183 (52 week) and now 122 its around 33% down for their upper price. Gail Limited is Government of India undertaking company. Gail is the largest state-owned natural gas processing and distribution company in India. It is headquartered in New Delhi. It is a state-owned enterprise of the Government of India, under the administrative control of the Ministry of Petroleum and Natural Gas.
GAIL is good dividend player and also given 1:1 bonus in 6 month back. As per the current dividend which is around 5% of their CMP. Long term investor can continue with the company with target price of INR 145. Major resistance is 135. Strong support near at 115.
Opportunities: Largest natural gas processing and distribution company in country. Navratna status under Govt of India company. Beaten down value at CMP.
Risk: Govt of India undertaking and also as per the market rumours and govt statement regarding demerger of pipeline business is correcting the share price.
Disclaimer: Views are shared based on market research and study and personal in nature. Others can take the different view and opinions. Please do the thoroughly study before enter or exit the shares.
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