XTRAS: GAIL India Ltd has won the leader award in the 11th edition of prestigious Frost & Sullivan and The Energy and Resources Institute (TERI) Sustainability Awards 2020.
SWOT ANALYSIS
STRENGHTS
• The company has strong integrated operations, aiding in sustainable growth.
• Top company in natural gas sector.
• Increasing revenue every quarter for the past 4 quarters.
• Low debt.
WEAKNESSES
• The concentration of revenues in India, exposing it to the risk of economic slowdown.
• The business has experienced the absence of monetary and technical resources.
• The company has had poor sales growth of 1.87% over the past five years.
OPPORTUNITIES
• Consumption of energy is expected to grow in recent years.
• Strategic sourcing of natural gas would help to meet the increasing needs of the domestic market.
• Presence in Polymer sector.
THREATS
• Stiff competition across different market segments.
• Drilling natural gas wells involves numerous risks, like the company may not encounter commercially productive natural gas reservoirs.
FUTURE PROSPECTS
• To boost the gas based economy, the Government has announced various reforms in the gas sector, giving the much needed thrust to the industry.
• The company would be pushing for higher gas usage in industrial segment, transport segment using CNG & LNG, Trigeneration, cold storage etc.
• It is looking for avenues to supply gas in new segments like LNG trucking i.e.; LNG for long haul transportation.
• It is looking to expand its presence in petrochemicals and diversifying into high margin downstream business.
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