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WIKI ANALYSIS
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GAIL
GAIL (India) Ltd. is the country’s largest gas distribution and transmission company with a pipeline network of around 7,000 kms and with a capacity to carry 150 million standard cubic metres per day (MMSCMD) of natural gas. It operates in the gas transmission, gas trading, LPG & other liquid hydrocarbons, LPG transmission, petrochemicals and telecommunications segments. The company’s HBJ pipeline is the lifeline for major gas consumers ranging from power to fertilizer sectors.
In FY09, GAIL managed to grow its net sales by 33% YoY despite pressure on realisations. This was led by the company’s natural gas trading business, which reported a growth of 45% YoY during the year. It transmitted around 83.3 million metric standard cubic meters per day (mmscmd) of natural gas. Further, it achieved natural gas sales of 79.1 mmscmd. The other two key businesses of ‘petrochemicals’ and ‘LPG & liquid hydrocarbons’ recorded lackluster performances, growing their sales by just around 6% YoY and 12% YoY during the year.
GAIL has planned a capital expenditure of Rs 300 bn in the next 3 years and has already committed Rs 110 bn. While 80% investment will be in its core business of pipelines, 20% of the investment will be in exploration and production, city gas distribution and petrochemicals. The company has 5,000 kms of pipelines work in progress. The company’s transmission capacity will go up to 200 mmscmd by the end of FY10 and 300 mmscmd by the end of FY12. As a result, the company expects transmission revenue to go up 3 times.
| Financial Performance Snapshot | ||||||
|
(Rs m) | 4QFY08 | 4QFY09 | Change | FY08 | FY09 | Change |
|---|---|---|---|---|---|---|
| Sales | 49,431 | 62,340 | 26.10% | 180,699 | 239,608 | 32.60% |
| Expenditure | 37,753 | 51,468 | 36.30% | 140,590 | 197,216 | 40.30% |
| Operating profit (EBDITA) | 11,677 | 10,871 | (6.90%) | 40,109 | 42,392 | 5.70% |
| Operating profit margin (%) | 23.60% | 17.40% | 22.20% | 17.70% | ||
| Other income | 919 | 881 | (4.10%) | 4,947 | 6,118 | 23.70% |
| Interest | 195 | 306 | 56.50% | 796 | 870 | 9.30% |
| Depreciation | 1,425 | 1,410 | (1.00%) | 5,710 | 5,599 | (1.90%) |
| Profit before tax | 10,976 | 10,037 | (8.60%) | 38,550 | 42,040 | 9.10% |
| Tax | 3,752 | 3,737 | (0.40%) | 12,535 | 14,003 | 11.70% |
| Profit after tax/(loss) | 7,224 | 6,300 | (12.80%) | 26,015 | 28,037 | 7.80% |
| Net profit margin (%) | 14.60% | 10.10% | 14.40% | 11.70% | ||
| No. of shares (m) | 845.6 | 1,268.40 | ||||
| Diluted earnings per share (Rs)* | 22.1 | |||||
| P/E ratio (x)* | 13.1 | |||||
| * On a trailing 12 months basis | ||||||
| Segment-wise performance | ||||||
|
(Rs m) | 4QFY08 | 4QFY09 | Change | FY08 | FY09 | Change |
|---|---|---|---|---|---|---|
| Natural gas transmission | ||||||
| Revenue | 5,562 | 6,511 | 17.10% | 22,479 | 24,824 | 10.40% |
| % share | 9.90% | 9.40% | 10.90% | 9.20% | ||
| PBIT margin | 56.80% | 66.70% | 65.80% | 64.40% | ||
| LPG transmission | ||||||
| Revenue | 1,081 | 992 | (8.20%) | 3,826 | 3,803 | (0.60%) |
| % share | 1.90% | 1.40% | 1.90% | 1.40% | ||
| PBIT margin | 55.30% | 64.40% | 57.00% | 58.10% | ||
| Natural gas trading | ||||||
| Revenue | 33,820 | 47,430 | 40.20% | 126,484 | 183,083 | 44.70% |
| % share | 60.20% | 68.20% | 61.50% | 68.00% | ||
| PBIT margin | 2.10% | 1.20% | 1.60% | 1.90% | ||
| Petrochemicals | ||||||
| Revenue | 7,478 | 6,813 | (8.90%) | 25,873 | 27,309 | 5.60% |
| % share | 13.30% | 9.80% | 12.60% | 10.10% | ||
| PBIT margin | 44.90% | 48.10% | 47.00% | 44.30% | ||
| LPG & liquid hydrocarbons | ||||||
| Revenue | 7,909 | 7,671 | (3.00%) | 26,407 | 29,641 | 12.20% |
| % share | 14.10% | 11.00% | 12.80% | 11.00% | ||
| PBIT margin | 42.00% | 29.20% | 33.00% | 29.00% | ||
| GAILTEL | ||||||
| Revenue | 72 | 49 | (31.90%) | 281 | 243 | (13.70%) |
| % share | 0.10% | 0.10% | 0.10% | 0.10% | ||
| PBIT margin | (12.80%) | (34.40%) | 3.80% | (18.70%) | ||
| Others | ||||||
| Revenue | 214 | 63 | (70.70%) | 298 | 519 | 74.40% |
| % share | 0.40% | 0.10% | 0.10% | 0.20% | ||
| PBIT margin | (113.30%) | (2626.90%) | (1681.50%) | (1192.90%) | ||
| Total* | ||||||
| Revenue | 56,137 | 69,530 | 23.90% | 205,646 | 269,423 | 31.00% |
| PBIT margin | 19.40% | 13.60% | 17.70% | 14.40% | ||
| * Excluding inter-segment adjustments | ||||||
***********
GAIL (India) Limited, is India's flagship Natural Gas company, integrating all aspects of the Natural Gas value chain (including Exploration & Production, Processing, Transmission, Distribution and Marketing) and its related services. In a rapidly changing scenario, we are spearheading the move to a new era of clean fuel industrialisation, creating a quadrilateral of green energy corridors that connect major consumption centres in India with major gas fields, LNG terminals and other cross border gas sourcing points. GAIL is also expanding its business to become a player in the International Market.
Turnover (2008-09): Rs. 23, 776 crores And Net Profit (2008-09): Rs. 2804 crore '
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