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The Indian railway industry is a significant contributor to the nation’s economy, with over 1.4 million employees and a vast network of tracks covering thousands of kilometres. Investing in railway stocks can be a promising opportunity due to the sector’s steady growth potential. 

Listed below is one such railway stock in which Mukul Agrawal bought fresh stake of 5.53 percent during Q4FY24: 

Oriental Rail Infrastructure Ltd 

With a market capitalization of Rs. 1,544 crores, the shares of the company engaged in the manufacturing of Seats and Berths started Tuesday’s trading session on a flatter note at Rs. 255 compared to its previous close of Rs. 256.05. During the trading session, the shares hit a high of Rs. 266.70, gaining around 3 percent and closed the day at Rs. 261 apiece. 

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Looking at the company’s financial statements, the revenue zoomed by 29 percent from Rs. 115 crores during the September quarter to Rs. 147 crores in the December quarter. In addition, the net profits increased by 63 percent from Rs. 8 crores to Rs. 13 crores during the same period. 

Comparing these metrics on a YoY basis, the revenue increased by 39 percent from Rs. 106 crores during Q3FY23 to Rs. 147 crores in Q3FY24. On the other hand, the net profits magnified by 550 percent from Rs. 2 crores to Rs. 13 crores during the same timeframe. 

According to the latest shareholding pattern, Ace Investor Mr Mukul Agrwal bought a fresh stake in the company’s shares during the recent quarter by acquiring approximately 34 lakh equity shares equivalent to 5.53 percent and the current holding value of his investment amounts to Rs. 89 crores. 

The stock has delivered a whopping 454 percent returns to its shareholders in one year. For example, if someone had invested Rs. 1 lakh in these shares a year ago then the worth of those shares would be Rs. 5.54 lakhs now. 

Recently, in March 2024, Oriental Foundry Private Limited, a wholly-owned subsidiary of the company, secured an order valued at Rs. 1,249.09 crores from the Ministry of Railways (Railway Board), Indian Railways. The order was received for the manufacture and supply of 3,055 BOXNHL Wagons (including an additional 91 Nos. BOXNHL Wagons). 

Additionally, Oriental Rail Infrastructure announced that the company along with its subsidiary company (Oriental Foundry Private Ltd) has total orders in hand of approx. Rs 1,500 crores. 

Due to increasing expenditure, the profitability metrics of the company declined with the return on equity (RoE) decreasing from 15.51 percent during FY 21-22 to 2.52 percent in FY 22-23, and, the return on capital employed (RoCE) showed a downward movement from 17.30 percent to 5.60 percent during the same timeframe. Furthermore, the net profit margin decreased from 11.57 percent during FY 21-22 to 1.71 percent during FY 22-23. 

Headquartered in Mumbai, Oriental Rail Infrastructure was incorporated in 1991. The company is engaged in the manufacturing, buying, and selling of all types of Recron, Seat and Berth, and Compreg Boards, and also engaged in trading of timber woods and all its products. 

Written By Vaibhav Patil

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