Rail Vikas Nigam shares have been trending upward since September last year, primarily driven by significant order wins, which are a result of the ongoing transformation within the railway sector.
During Union Budget 2023-2024, the government announced a capital outlay of ₹2.40 lakh crore for the Indian Railways, the highest ever outlay and about 9 times the outlay made in 2013-14.
The company shares in the current year so far have delivered a staggering return of nearly132%, climbing from ₹68.25 to the present level of ₹158.20. From their September 2022 lows of ₹32.85, they have gained nearly 328% to date.
During Monday's trade, the shares jumped 18.18% in value to record a new historic high of ₹163.4. This surge was in response to the company's latest order win worth ₹322 crore from Madhya Gujarat Vij Company.
In July, the company emerged as the lowest bidder for various projects of Maharashtra Metro Rail Corporation Limited. These projects include the construction of six elevated metro stations, one elevated and one at-grade station, an elevated metro track supporting structure, and a multi-story building.
The combined estimated cost for these projects stands at ₹256.19 crore, as reported in the company's exchange filing. Additionally, the company emerged as the lowest bidder (L1) for two MPPKVVCL Jabalpur Company Area Packages, 16 and 17.
Further, in July, the company received a Letter of Award from the Haryana Rail Infrastructure Development Corporation (HRIDC) for a project worth ₹1,088 crore, and in the same month, it received an order worth ₹808.4 crore from NHAI for a road project in Odisha.
While in June, the state-owned company was awarded three orders worth ₹11,256 crore from the Chennai Metro Rail Ltd. These orders are for the construction of underground stations in the Phase II project.
These significant order wins have been instrumental in driving the stock's consistent upward trajectory. At current levels, the stock is positioned as the second-top gainer in the S&P BSE PSU index, with a yearly return of 371.17%.
Meanwhile, the company's offer for sale in July received an enthusiastic response from institutional investors.
Incorporated in 2003 by the Ministry of Railways (MoR), it is a wholly-owned government company, a Miniratna (Category – 1) Schedule ‘A’ Central Public Sector Enterprise.
The company focuses on executing all types of railway projects, including new lines, doubling, gauge conversion, railway electrification, metro projects, workshops, major bridges, construction of cable-stayed bridges, and institution buildings.
Rail Vikas Nigam shares made their debut on Indian stock exchanges on April 11, 2019, with a listing price of ₹19.10. Considering the current market price, the shares have seen an impressive growth of 732% over the issue price of ₹19.
In terms of financial performance, the company reported a consolidated net profit of ₹343 crore for Q1FY24, marking a 15% improvement over the ₹298 crore net profit recorded in the corresponding period of the previous year. The revenue from operations during the quarter reached ₹5,572 crore, a 20% YoY growth compared to ₹4,641 crore in Q1FY23.
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