Rs 85,000 crore order book & 1,500 per cent returns: President of India-backed multibagger railway infrastructure stock hit 52-week high on June 24

The stock gave multibagger returns of 250 per cent in just 1 year and a whopping 1,500 per cent in 5 years.

On Monday, shares of Rail Vikas Nigam Ltd (RVNL) gained 5.44 per cent to an intraday high of Rs 432 per share from its previous closing of Rs 409.70. The stock also made a fresh news 52-week high of Rs 432 while its 52-week low is Rs 117.35. The company's shares saw a spurt in volume by 1.01 times on BSE.

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 20.30 per cent CAGR over the last 5 years and has been maintaining a healthy dividend payout of 33 per cent. As of March 31, 2023, RVNL has a strong order book of over Rs 85,000 crores, focusing on railway, metro, and overseas projects.

Rail Vikas Nigam Limited (RVNL) has been selected as the lowest bidder (L1) by SER HQ-Electrical/South Eastern Railway for a project involving the design, supply, installation, testing and commissioning of a 132 KV Traction Substation, Sectioning Posts (SPs) and Sub-Sectioning Posts (SSPs) on the Rajkhaswan-Nayagarh-Bolani section of the Chakradharpur division of the South Eastern Railway. This EPC (Engineering, Procurement and Construction) mode contract aims to achieve a loading target of 3000 MT. The project will be executed within 18 months and has a total value of Rs 191,53,74,279.51 (including applicable taxes).

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Earlier, the company was selected as the lowest bidder (L1) by East Coast Railway for a project involving the upgrade of railway signalling systems along three sections: Jakhapura-Nergundi, Khurda Road-Bhusundpur, and Bhusundpur-Golanthra, all within the Khurda Road Division of East Coast Railway. The project will include the installation of an Automatic Block Signaling system with dual Mobile Train Supervision and Communication (MSDAC) along with modifications to existing electrical installations, interlocking systems, and route relay interlocking stations. This domestic contract, valued at Rs 160,08,57,055.35, is expected to be completed within 24 months. It is important to note that neither the promoters of RVNL nor any affiliated companies have any interest in East Coast Railway, and there are no sub-contracts involved in this project.

According to Quarterly Results, the net sales increased by 17.4 per cent to Rs 6,714.01 crore and net sales increased by 27.5 per cent to Rs 435.34 crore in Q4FY24 compared to Q4FY23. 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 Board recommended a final dividend of Rs 2.11 per share (i.e. 21.10 per cent) on the paid-up equity share capital for the financial year 2023-24.

In March 2024, the President of India’s portfolio sold 11,17,57,277 shares and decreased their stake to 72.84 per cent compared to 78.20 per cent in March 2023. The company has a market cap of over Rs 87,000 crore and the shares of the company have an ROE of 21 per cent and an ROCE of 18 per cent. The stock gave multibagger returns of 250 per cent in just 1 year and a whopping 1,500 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.