gail share price: GAIL shares in focus after $285 million settlement with SEFE Marketing, case withdrawn in London

State-owned GAIL (India) Ltd shares will be in the spotlight on Thursday, January 16, after the company announced a settlement agreement with SEFE Marketing & Trading Singapore Pte Ltd, resolving pending arbitration proceedings.

The settlement, finalised on Wednesday, involves SEFE Marketing paying $285 million to GAIL (India), marking a resolution to the dispute. The agreement also includes the withdrawal of the arbitration proceedings before the London Court of International Arbitration.

“The terms of the Settlement Agreement include payment of US$ 285 million by SEFE Marketing & Trading Singapore Pte. Ltd. to GAIL (India) Limited and withdrawal of arbitration proceedings before London Court of International Arbitration,” the company said in an exchange filing.

Also Read: Q3 results today: RIL, Infosys among 37 companies to announce earnings on Thursday

GAIL reported an 11% year-on-year (YoY) increase in profit in the quarter to September to Rs 2,672 crore as improved performance in petrochemicals and gas transmission helped offset a poor show in gas marketing. Its revenue from operations increased 3.5% YoY to Rs 32,931 crore in the July-September period.

India’s largest natural gas marketer and transporter witnessed a 26% drop in operating profit in the gas marketing business during the quarter to Rs 1,329 crore. Operating profit in the gas transmission business increased 8% to Rs 1,403 crore.Also Read: Q3 numbers a concern, mutual funds buy defensives

As per Trendlyne data, the average target price of the stock is Rs 232, which indicates an upside potential of 30% from the current market prices. The consensus recommendation from 32 analysts for the stock is a ‘Buy’.

On Wednesday, GAIL shares closed at Rs 178, up 1.2% on the BSE, while the benchmark Sensex surged 0.29%. The stock has declined 25% over the past six months but gained 85% in the last two years. The company’s market capitalization stands at Rs 1,17,036 crore.

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