This PSU stock in the transportation space is trading at an all-time high; do you hold it?

The shares surged 7.42 per cent on the day.

 On September 29, after opening at Rs 304.85, shares of RITES Ltd increased by 7.42 per cent and closed at Rs 324.3. 

RITES Ltd is a public sector enterprise with a large geographical footprint that is a leading player in the transportation consultancy and engineering sector in India. The company is the sole export arm of Indian Railways for providing rolling stock in international markets. 

FY22 was a very successful year for the company, with sales and net profit figures that were the highest ever recorded. Sales and net profit for FY22 were Rs 2662 and Rs 539 crore, respectively. As of the end of the fiscal year, the company's ROE and ROCE were 21.1 per cent and 30.2 per cent, respectively. 

For the latest June quarter, on a consolidated basis, the company generated revenue of Rs 637 crore. Similarly, its FY22 net profit improved by 85 per cent from Rs 78 crore reported in FY21.  

About the shareholding pattern, 72.2 per cent of the stake is owned by the Government of India, 1.48 per cent by FIIs, 17.26 per cent by DIIs, and the rest 9.06 per cent by non-institutional investors.  

The company has a market capitalisation of Rs 7719.7 crore and is currently trading at a PE multiple of 13.05. The stock has a 52-week high and low of Rs 324.3 and Rs 226.05, respectively.  

The government’s emphasis on transport infrastructure spending is painting a positive outlook for the company.