Source: https://www.dsij.in/dsijarticledetail/rs-83221-crore-order-book-railway-infrastructure-company-emerges-as-the-lowest-bidder-l1-for-an-order-worth-rs-180009681008-from-east-central-railway-id001-42572-1
Publisher: Dalal Street Investment Journal
Rail Vikas Nigam Limited (RVNL) has secured the lowest bid (L1) for a major railway electrification project awarded by East Central Railway. The contract entails designing, supplying, erecting, testing, and commissioning 2x25KV feeder lines along the track, along with modifications to the existing 25KV overhead electrification (OHE) system. This project is crucial for increasing the loading capacity of the Garwa Road-Mahadiya section of the Dhanbad Division to 3000 MT, enhancing freight transportation efficiency. The contract is valued at Rs 180,00,96,810.08 and is expected to be completed within 18 months.
Earlier, Rail Vikas Nigam Limited (RVNL) partnered with Engineers India Limited (EIL) to expand its global reach in infrastructure projects. The collaboration formalized through a Memorandum of Understanding (MoU), focuses on identifying and pursuing joint projects, sharing market information, establishing a strong working relationship, and developing business proposals, including EPC opportunities, across various government, semi-government, private, and multilateral entities worldwide.
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 215 per cent in just 1 year and a whopping 2,100 per cent in 5 years. Investors should keep an eye on this railway infra stock.
