GAIL (India) fell 5.46% to Rs 500.25 at 15:12 IST on BSE after couple of brokerages downgraded their ratings on the stock.
Meanwhile, the BSE Sensex was up 10.13 points, or 0.04%, to 27,875.96.
On BSE, so far 7.29 lakh shares were traded in the counter, compared with an average volume of 94,122 shares in the past one quarter.
The stock hit a high of Rs 535.50 and a low of Rs 498.10 so far during the day. The stock hit a record high of Rs 551.35 on 31 October 2014. The stock hit a 52-week low of Rs 310 on 18 November 2013.
The stock had outperformed the market over the past one month till 31 October 2014, rising 17.89% compared with 4.64% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 21.27% as against Sensex's 7.61% rise.
The large-cap company has an equity capital of Rs 1268.48 crore. Face value per share is Rs 10.
A foreign brokerages has reduced its rating on GAIL (India) to sell from outperform with a target of Rs 475 per share as it feels that the state-run natural gas transmission company is trading at 40% premium to its 10 year average price to equity. Hence, the brokerage finds these valuations unsustainable since turnaround in core business is unlikely in next two years and return-on-equities (ROEs) will remain under pressure.
GAIL (India) did not build any subsidy burden pending quarterly demand from oil ministry and this boosted its Q2 September 2015 net profit. The recent stock price rally completely ignores earnings risk from falling crude given its big sensitivity, the brokerage said.
Another foreign brokerage has downgraded its rating on the GAIL (India) stock to neutral from outperform for a target Rs 485.
Meanwhile, a domestic brokerage has advised to sell the GAIL (India) stock with a target Rs 465.
GAIL (India)'s net profit surged 42.28% to Rs 1302.90 crore on 1.36% growth in total income to Rs 14418.53 crore in Q2 September 2014 over Q2 September 2013.
GAIL (India) is India's flagship gas transmission and marketing company with global footprints. The Government of India (GoI) holds 56.11% stake in GAIL (India) (as per the shareholding pattern as on 30 September 2014).
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