UBS has retained its Buy rating on GAIL India Ltd, setting a target price of ₹225, which implies an upside of approximately 16.5% from the current market price of ₹193.10. The brokerage cited supportive regulatory reforms and an attractive valuation for the company’s transmission segment as key drivers behind its bullish stance.
The report highlighted that ongoing pipeline tariff reforms and the possibility of upcoming tariff hikes are likely to act as positive sentiment triggers. While acknowledging that GAIL may face short-term or cyclical challenges in some of its business segments, UBS remains optimistic about the long-term outlook.
“We value the transmission segment at 9.8x FY27E EV/EBITDA, which we view as attractive,” the brokerage said. It also added that the recent regulatory tailwinds and expected tariff revisions are not yet fully priced into the stock, offering scope for re-rating.
UBS expects a higher contribution from the transmission business in the coming years, aided by the latest reforms that are set to enhance the segment’s profitability and valuation metrics.
At ₹193.10, the stock remains below UBS’s fair value estimate, reinforcing its positive view on GAIL’s structural growth story.
Disclaimer: The views expressed above are those of UBS and do not constitute investment advice. This article is for informational purposes only.
