This gas distribution company wants to raise ₹3,100cr via IPO
What's the story
GAIL Gas Limited has started the process of appointing investment banks for an initial public offering (IPO) that could raise up to ₹3,100 crore, as per Mint. The city gas distribution company, which is a wholly owned subsidiary of state-run GAIL (India) Ltd, is looking to hire up to four book-running lead managers for the proposed share sale. A pre-bid meeting with interested merchant bankers is likely to be held this week.
Strategic divestment
Strategic importance of IPO
The IPO is a key component of India's Asset Monetisation Pipeline 2.0, which involves government-owned firms divesting stakes in their subsidiaries between fiscal year 2027 and fiscal year 2030.
The proceeds from these sales will be retained by the companies as monetized value.
NITI Aayog's February report had projected the GAIL Gas IPO for FY28, indicating its strategic importance in India's asset monetization efforts.
Business expansion
Expansion plans and geographical presence
Established in 2008, GAIL Gas is responsible for city gas distribution projects across India.
It currently operates in 16 geographical areas across nine states and is looking to expand into Andhra Pradesh, Goa, and Assam.
The company plans to acquire six more areas from its parent company for around ₹1,500 crore as part of its growth strategy.
Financial overview
Financial performance in FY26
In FY26, GAIL Gas reported a turnover of ₹12,681 crore, up from ₹12,229 crore in FY25. The company and its joint ventures also added 120 CNG stations and completed 191,000 domestic PNG connections during the year.