The shares of this multibagger rail stock jumped more than 4 percent in Wednesday’s trading session after the company formed a new Joint Venture (JV) company for Solar EPC Projects within India and abroad.
With a market capitalization of Rs 48,601.82 crores, the stocks of Rail Vikas Nigam Limited (RVNL) opened their trading hour on Wednesday at Rs 223.85 and currently trade at Rs 233.10, gaining around 4.50 percent as compared to the previous closing levels of Rs 223.50 apiece.
Such sharp movements in the company’s share price were witnessed after the company, through a regulatory filing with the Bombay Stock Exchange (BSE), announced that it has incorporated “JGPL-RVNL EPC Private Limited”, a Joint Venture (JV) company between ‘Jakson Green Private Limited’ (JGPL) and Rail Vikas Nigam Limited.
The rationale for the JV company pertains to the exploration of Solar Power/Green clean energy projects within as well as outside India. The shareholding pattern of the JV exhibits JGPL holding a 51 percent stake and RVNL holding the remaining 49 percent stake.
Keeping a purview of one year, the company’s stock has delivered multibagger returns of 213 percent to its stakeholders, viz, if someone had invested Rs 1 lakh into the company’s stock a year ago, it would have converted to Rs 3.13 lakhs.
During the recent financial quarters, the company reported its basic business indicators such as operating revenues and after-tax profits in opposing directions. The former, on one end, dipped from Rs 5,571 crores during Q1FY23-24 to Rs 4,914 crores during Q2FY23-24, and the latter, on the other end, rose from Rs 335 crores to Rs 370 crores.
As a result of the above, the company’s profitability metrics such as return on equity (RoE) and return on capital employed (RoCE) rose marginally with the former moving up from 18.48 percent during FY21-22 to 19.39 percent during FY22-23, and the latter, during the same period, rising from 15.05 percent to 15.88 percent.
Incorporated in 2003, Rail Vikas Nigam Limited (RVNL) is associated with the business of constructing rail infrastructure projects in India. The company undertakes the development and implementation of rail projects and also provides mobilization of financial resources. It executes various railway projects, including railway electrification, gauge conversion, etc.
Written by Amit Madnani
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