A large-cap railway stock in the Navratna category rose 1.69% after receiving a Rs. 180 crore order from East Central Railway for the turnkey project of the UP and DN line of Garwa Road.
Share price variations:
With a market capitalization of Rs. 1,11,319.22 crores, Rail Vikas Nigam Limited opened the trading session at Rs. 521.50, below the Friday’s close of Rs. 526.35. The stock reached an intraday high of Rs. 535, reflecting a 1.69% increase from Friday’s close. The stock closed at Rs. 533.90 per share.
Reason for Rise:
According to exchange filings, Rail Vikas Nigam Limited has been selected as the lowest bidder for a contract with East Central Railway. The project entails the design, supply, erection, testing, and commissioning of a 2x25KV feeder line along the track, along with 25KV OHE modification works, to achieve a 3000 MT loading target for the UP and DN lines of the Garwa Road-Mahadiya section in the Dhanbad Division. The project has a cost of Rs. 180 crores and an execution timeline of 18 months.
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Recent Major Projects:
In August, the company secured a contract worth Rs. 202.87 crores from SER HQ Electrical/South Eastern Railway for the design, supply, erection, testing, and commissioning of a 132 KV traction substation and associated posts in a 2x25KV system at Kharagpur. Additionally, it received an order from Southern Railway for Rs. 111.38 crores to provide MSDAC at stations and replace remaining AFTCs in the Chennai Division’s automatic block signalling sections. The company has also formed a Subsidiary under the name “Rail Vikas Nigam LLC” in Uzbekistan.
In July, the company was selected as the lowest bidder for a project from HPSEBL valued at Rs. 739.07 crores for the development of distribution infrastructure in the Central Zone of Himachal Pradesh.
Financial Performance:
For Q1FY25 the company reported a net profit decrease of 34.70% to Rs. 217.8 crores compared to net profit of Rs. 333.57 crores in Q1FY24, while revenue from operations also marked a decrease by 25.37% to Rs. 4,064.27 crores from Rs. 5,446.25 crores in comparison to the same period.
The stock has delivered nearly 104% return over the past six months and a multibagger return of 193% on a year to date basis. Company has a ROE of 20.39% and ROCE of 17.80% in FY24.
About the company:
Rail Vikas Nigam Ltd was Incorporated in 2003 by the Govt. of India, it is engaged in the business of implementing various types of Rail infrastructure projects assigned by MoR including doubling, gauge conversion, new lines, railway electrification, major bridges, workshops, Production Units and sharing of freight revenue with Railways as per the concession agreement entered into with Ministry of Railway.
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Written By: Joseph Pv
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