Oil India Limited (OIL) and GAIL India Limited on Wednesday (July 9) signed a 15-year extension to their existing Gas Sale and Purchase Agreement (GSPA) for the supply of natural gas from OIL’s Rajasthan fields. 

Under the renewed pact, effective from July 1, 2025, GAIL will source up to 900,000 Standard Cubic Meters per Day (SCMD) of natural gas from OIL. The gas will be delivered to the Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL), the state-run power utility, to support electricity generation through cleaner fuel.

Fourth Quarter Results

GAIL's revenue for the quarter increased by 2.1% from last year to ?35,685 crore from ?34,937 crore last year. The figure was below the CNBC-TV18 poll of ?37,042 crore. Net profit for the period nearly halved to ?2,049 crore and was marginally below expectations of ?2,153 crore.

GAIL's Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the quarter increased by 13.3% year-on-year to ?3,215 crore, which was in line with expectations of ?3,260 crore, while margins expanded by 90 basis points from the previous quarter to 9% from 8.1% in December. The EBITDA margin figure was also in line with the CNBC-TV18 poll of 8.8%.

GAIL has earmarked a capex plan of ?10,000 crore for the financial year 2026, which will be utilised for the petchem, equity investments, pipelines and the LNG vertical. The management also said that there has been an impact on profitability due to the cut in supply, but operations are continuing through a mix of both new and old well gas.

Shares of GAIL (India) Ltd closed at ?185.05, down ?7.60 or 3.94%, while shares of Oil India Ltd ended at ?445.35, up ?2.40 or 0.54% on the BSE.

Source: CNBC TV 18

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