This Railway PSU company, which is engaged in the business of various types of Rail infrastructure project implementation went up 5% in the day’s trade after receiving multiple orders worth Rs. 7,250 crore from Multiple Organisations.
Price Movement
In Wednesday’s trading session, Rail Vikas Nigam Limited stock was up by 5 percent in the day’s trade after bagging multiple orders from Multiple Organisations. The stock has delivered a return of around 201 percent in the past year and outperformed Nifty in the same period. The stock reiterated from the day’s high of Rs. 472.30 and was trading at Rs. 466.10 which is 3.37 percent from the previous closing price of Rs. 450.90 per share.
What happened
Rail Vikas Nigam received an order worth Rs. 837 crores from Eastern Railway for Earthwork cutting and filling, blanketing, and construction of minor bridges and others between Kalipahari to Pradhankhuta in connection with the construction of a multi-tracking railway line.
The second order worth Rs. 5,008 crore is from Bharat Sanchar Nigam Limited for the Development (Creation, Upgradation Operation & Maintenance) of the Middle mile network of Bharat Net on design build operation, and maintain model.
Third Order worth Rs. 613 crore is from Rail Infrastructure Development Company (Karnataka) for the Construction of Nine Stations at Singena Agrahara, Heelalige, Ambedkar Nagar, Huskur, Bellandur, Carmelaram, Doddanakundi, Marathahalli, Kaggadasapura including Civil, Structural, PEB works with associated works for Bengaluru Suburban Rail Project. The share will be RVNL – 51 percent and Rithwik Projects – 49 percent.
Financial Performance
Their Q1FY25 results show revenue from operations of Rs. 4,074 crore which declined by 26.88 percent year on year, from Rs. 5,572 crore in Q1FY24 and a 39.32 percent decrease from Rs. 6,714 crore in Q4FY24. Their net profit decreased by 34.69 percent year on year, from Rs. 343 crores in Q1FY24 to Rs. 224 crores in Q1FY25. Quarterly, the profits were down 53.13 percent from Rs. 224 crore.
The return on equity in FY24 stood at 19.7 percent improved from 20.81 percent a year ago. The debt-to-equity ratio was 0.78 times which has decreased from 0.96 times in FY23. However, the return on capital employed has stood at 17.59 percent which has improved from 17.22 percent in FY23.
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Revenue Segment
According to the company’s annual report, they considered revenue from Contract Revenue from external customers which contributed around 94.86 percent, other unallocable income – 2.95 percent, and interest income contributed 2.18 percent in FY24. They earn most of their revenues from the railway segment.
Shareholding Pattern
As of September 2024, the shareholding pattern includes promoters holding a major share of 72.84 percent stake in Rail Vikas Nigam, Foreign Institutional Investors (FII) holding around 5.05 percent, Domestic Institutional investors (DII) standing at 6.33 percent, and public holdings standing at 15.78 percent.
About the company
Rail Vikas Nigam Limited (RVNL) is a PSU under India’s Ministry of Railways which was established in 2003 to expedite railway infrastructure projects. Their business model focuses on project management, engineering, procurement, and construction (EPC) of railway lines, bridges, and electrification.
RVNL collaborates with government entities and private sectors to enhance rail connectivity. The company operates an asset-light model, primarily receiving direct assignments from the government, while also diversifying into open bidding for projects. This strategy positions RVNL for significant growth in revenue and infrastructure development across India and beyond. The order book is around 83,221 crore as of the June 2024 quarter.
Written by Santhosh S
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