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Shares of GAIL (India) Ltd., the Maharatna natural gas major, faced strong selling pressure on Friday after the Petroleum and Natural Gas Regulatory Board (PNGRB) announced a tariff revision that failed to meet market expectations. The stock fell more than 6.5% in early trade on the BSE.
GAIL shares declined sharply to an intraday low of Rs. 171.80, compared with a previous close of Rs. 183.80. By 12:10 pm, the stock was still trading significantly lower at Rs. 174.30, a drop of 5.16%, as traders reassessed the impact of the new tariff structure.
Despite the decline, brokerages Citi and UBS maintain a ‘Buy’ rating on the PSU stock.
Over the last six months, GAIL has lost 11% in value. Since the beginning of 2025, it has declined 9.5%, and over the past year, it has fallen 12%.
Despite this weak short-term performance, GAIL has delivered strong long-term returns, rising 153% over the last five years.
After months of delay, the PNGRB has approved a 12% increase in GAIL’s Integrated Natural Gas Pipeline (INGPL), effective from January 2026.
However, the increase failed to meet investor expectations, as analysts were anticipating a 15% revision, while the company itself had proposed a 33% hike.
The regulator clarified that the decision was taken to avoid a sudden spike in transmission costs.
The 12% tariff increase is based on two adjusted parameters. The first is a Rs. 5.16 per MMBtu rise due to higher system-use gas (SUG).
The second is a Rs. 1.92 per MMBtu increase resulting from a revised, lower volume divisor tied to updated capacity evaluations.
Analysts have also highlighted that the 12% tariff revision does not necessarily equate to a 12% rise in realised tariffs, which could end up being lower depending on demand.
According to analysts, the intermediate support zone lies between Rs. 170-Rs. 167, and this range may offer some stability in the event of further downside pressure.
If the stock drops below the Rs. 167 level, the technical structure could weaken substantially.
On the upside, resistance levels are positioned between Rs. 175-Rs. 179, and a bearish price gap remains near the Rs. 183 region. Analysts currently view the short-term outlook as weak and recommend caution.
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The sharp fall in GAIL’s share price stems from the gap between what the market expected and what PNGRB delivered. Although the increase in tariffs is a positive development, the lower-than-expected increase will weigh on sentiment.
With further tariff adjustments not expected until FY28, the stock is likely to remain sensitive to regulatory updates, technical indicators, and overall sector movements.
