GAIL Shares: Shares of GAIL India surged 3 percent to Rs 214 in afternoon trade on June 11 after Morgan Stanley reiterated its ‘buy’ recommendation on the stock, spurred by the company’s plans to establish a 1,500 KTA ethane cracker project in Madhya Pradesh valued at Rs 60,000 crore.
The international brokerage has set a price target of Rs 250, indicating a potential upside of over 20 percent from the current market price. The company’s move to diversify its feedstock is notable, it stated.
In contrast, JPMorgan has maintained a ‘neutral’ stance on the stock and warned that if the project materializes, it might act as an overhang on the counter. Additionally, analysts noted that current valuations offer limited upside potential.
The Madhya Pradesh Industrial Development Corporation Limited has begun the process of allocating around 800 hectares of land for this substantial project. Once the necessary enablers are in place, GAIL’s board will seek investment approval.
Furthermore, a greenfield petrochemical complex is proposed, targeting the production of LLDPE, HDPE, MEG, and propylene. According to the Chief Minister’s Office of Madhya Pradesh, approximately 15,000 individuals will find employment during the construction phase, with around 5,600 jobs expected to be created during the operational phase.
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At around 1:30 pm, shares of the company were trading at Rs 213, up 2.3 % from the previous close on the National Stock Exchange. GAIL shares have surged 31 percent since the beginning of the year.
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