Higher volumes, profitability gains boost Gail's Q2FY25 performance

GAIL plans to add 80 new compressed natural gas (CNG) stations and 120,000 new domestic piped natural gas or PNG connections in next two years

Gail’s second quarter (Q2FY25) performance met expectations. Petchem turned profitable on higher volumes, and trading revenues were in-line. Analysts are pointing at some favourable factors for FY26 and FY27. There could be a transmission tariff hike in Q4FY25, steady growth in transmission and marketing volumes, and petchem capacity rising by two times in FY27. 

Gail expects 5 million metric standard cubic meters per day (mmscmd) per annum growth in marketing volumes for next two years. Trading segment profit guidance of Rs 4,500 crore may be exceeded. The management expects petchem segments Q2 operating profit run-rate to continue in H2FY25. The