GAIL shares rise nearly 3% as pipeline tariff hike decision moves closer
Published on 11/09/2025 02:14 PM
GAIL shares rise nearly 3% as pipeline tariff hike decision moves closerGAIL stock gained after sources said pipeline tariff hike decision is near, with analysts projecting a 10-20% rise that could sharply lift the company’s gas transmission earnings in coming years.By Sudarshan Kumar | Sheersh Kapoor September 11, 2025, 2:14:07 PM IST (Published)2 Min ReadShares of India's state-owned natural gas major, GAIL (India) Ltd. gained momentum on Thursday as expectations grew that the long-pending pipeline tariff hike may soon be announced.
According to sources, the Petroleum and Natural Gas Regulatory Board (PNGRB) is fast-tracking its decision on revising tariffs. An announcement could come within days. In July, a PNGRB member had already indicated a possible 20% increase in GAIL tariff pipeline.
Currently, GAIL’s pipelines have a tariff of ₹58.59 per million British thermal units (mmBtu). A revision towards the ₹70/mmBtu mark is seen as the most likely outcome.
At 1:53 pm, the stock was trading 2.8% higher at ₹178.74 on the NSE, after hitting an intraday peak of ₹179.78.
Brokerage commentary
Brokerages have quickly run the numbers on the potential impact.
Investec said it is “hoping for a 20% increase” but has conservatively modelled a 10% hike in FY26.
Jefferies noted that a 10% or 20% increase would lift GAIL’s transmission EBITDA in FY27 by 13% and 26%, respectively. It pegs the stock’s fair value at ₹235 in the 10% hike scenario, and ₹250 in the 20% case.
Also Read: Tariff revision for GAIL India pipelines expected by September, sources say
Nomura argued that the hike could provide a one-off boost and expects tariffs to be raised to around ₹70/mmBtu, applicable from April 2026. It sees a 42% year-on-year increase in gas transmission EBIT in FY27, with any integrated hike above 20% seen as a “positive surprise.”
For GAIL, a tariff increase has been long-awaited and could provide critical earnings support as the company navigates volatility in its trading and petrochemical segments.
Tariffs for this regulated segment have not been revised since 2018, despite significant expansion in GAIL’s pipeline grid and rising capital expenditure.Continue ReadingCheck out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!TagsGAILGail India share priceshare market todaytariff hikes