Rs 83,221 crore order book: Railway infrastructure company emerges as the lowest bidder (L1) for an order worth Rs 283,69,90,691.21 from East Coast Railway
The stock gave multibagger returns of 210 per cent in just 1 year and a whopping 2,105 per cent in 5 years.
East Coast Railway has awarded Rail Vikas Nigam Limited (RVNL) the contract for the construction of the third and fourth lines between Jarapada and Talcher Road, and the new line between Angul and Balram. The scope of the project includes earthwork, bridge construction, track laying, ballast supply, building construction, level crossing works, and other miscellaneous works. The project is valued at Rs 283,69,90,691.21 (including GST) and is expected to be completed within 24 months. RVNL, a domestic entity, has won the contract.
Earlier, RVNL secured a significant contract from East Central Railway to electrify the Garwa Road-Mahadiya section of the Dhanbad Division. The project, valued at Rs 180,00,96,810.08, involves designing, supplying, erecting, testing, and commissioning 2x25KV feeder lines along the track. The electrification will increase the section's loading capacity to 3000 MT, boosting freight transportation efficiency. RVNL is expected to complete the project within 18 months.
In a separate development, RVNL has partnered with Engineers India Limited (EIL) to expand its global footprint in infrastructure projects. The collaboration formalized through a Memorandum of Understanding (MoU), aims to identify joint projects, share market information, and develop business proposals together. This strategic alliance positions RVNL to tap into international markets and pursue EPC opportunities across various sectors.
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About the Company
Rail Vikas Nigam Ltd, a Navratna company was established in 2003 by the Government of India for various rail infrastructure projects. The company has delivered good profit growth of 21 per cent CAGR over the last 5 years and has been maintaining a healthy dividend payout of 33.4 per cent. As of June 30, 2024, RVNL has a strong order book of Rs 83,221 crores, focusing on railway, metro and overseas projects.
According to Quarterly Results, the net sales decreased by 27 per cent to Rs 4,073.80 crore and net profit decreased by 34 per cent to Rs 222.56 crore in Q1FY25 compared to Q1FY24. In its annual results, the net sales increased by 8 per cent to Rs 21,889.23 crore and net sales increased by 16.5 per cent to Rs 1,469.53 crore in FY24 compared to FY23. The company has a market cap of Rs 1,26,863 crore and the shares of the company have an ROE of 21 per cent and an ROCE of 19 per cent.
Life Insurance Corporation of India (LIC) bought 1,63,12,399 shares and increased their stake to 6.44 per cent in June 2024 compared to June 2023. In June 2024, FIIs increased their stake to 3.13 per cent and DIIs increased their stake to 6.77 per cent compared to March 2024. The stock gave multibagger returns of 210 per cent in just 1 year and a whopping 2,105 per cent in 5 years. Investors should keep an eye on this railway infra stock.
Disclaimer: The article is for informational purposes only and not investment advice.