The shares of this large-cap company fell around 2 percent despite receiving an order worth Rs. 191 crores from South Eastern Railway. In just six months the stock has delivered more than 90 percent returns to its shareholders.
Price Movement:
With a market capitalization of Rs. 1,21,129 crores, the shares of Rail Vikas Nigam Ltd started Thursday’s trading session on a lower note at Rs. 590 compared to its previous close of Rs. 593.75. During the trading session, the shares hit a low of Rs. 578.25, losing around 2 percent and are currently trading at Rs. 582 apiece.
What Happened:
According to the exchange filing, the company received a Letter of Acceptance (LoA) for a project worth over Rs. 191.53 crores from South Eastern Railway.
The LoA was received for the Design, Supply, Erection, Testing & Commissioning of 132 KV Traction Substation, Sectioning post (SPs), and Sub sectioning post (SSPs) in the 2x25KV System on the Rajkhaswan Nayagarh-Bolani section of Chakradharpur division of South Eastern Railway to meet 3000MT loading target on EPC mode.
Financials:
Looking at the company’s financial performance, the revenue surged by 43 percent from Rs. 4,689.33 crores in the December quarter to Rs. 6,714.01 in the March quarter. In addition, the net profits jumped by 33 percent from Rs. 358.57 crores to Rs. 478.4 crores during the same period.
Recent Developments:
RVNL signed a Memorandum of Understanding (MoU) with United Construction Limited, Israel to cooperate with each other to get projects in the field of Railways, MRTS, Tunnels, Roads (Highways & Expressways), Bridges, Building Works, Airports, Ports, Irrigation, Power Transmission and Distribution Sector, Solar Sector, Wind Sector in Israel.
Moreover, RVNL shares have seen significant volatility following the Union Budget 2024, with the stock initially plunging due to limited focus on the railway sector in the budget speech.
Investors were anticipating significant funding for the railways. Yet, Finance Minister Nirmala Sitharaman’s budget speech barely touched upon the railway sector, causing a notable drop in stock prices of RVNL, Ircon International, and other railway-related stocks.
Shareholding Pattern:
According to the latest shareholding, Domestic Institutional Investors increased their stake from 6.18 percent in the March quarter to 6.77 percent in the June quarter. Among them, LIC raised its stake from 6 percent to 6.44 percent during the same period.
Moreover, Foreign Institutional Investors also increased their stake from 2.32 percent during Q4FY24 to 3.13 percent in Q1FY25.
Order Book:
Rail Vikas Nigam has achieved a significant milestone with its order book reaching around Rs. 85,000 crores, out of this, Rs. 40,000 crores belongs to the bid portion and Rs. 45,000 crores to the nomination portion.
Company Profile:
Headquartered in New Delhi, Rail Vikas Nigam was incorporated in 2003. The company is engaged in the business of constructing Rail Infrastructure projects in India.
The company undertakes rail project development and implementation projects as well as provides financial resource mobilization services to its customers spanning various Central and State Government Ministries, departments, etc.
Written By Vaibhav Patil
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