RVNL Share Price: Stock Skyrockets on Order Win, Surges 200% in a Year

by | May 22, 2024 | 0 comments

RVNL Share Update: One of the leading Indian Railways Mini Ratna Public Sector Undertakings (PSUs) is Rail Vikas Nigam Limited (RVNL). RVNL plays a vital role in designing and executing railway projects across India by mobilizing financial resources, rail project development, enhancing golden quadrilateral, and improve port connectivity.

Recent Milestones

Major Order Win from South Eastern Railway

On May 21, 2024, there was a price increase in the RVNL Share by 15 percent. This was driven by the announcement of a large order worth Rs 148 crore from South Eastern Railway. The project involves upgradation an electric traction system for Kharagpur division through designing, supplying, erection; testing and commissioning. RVNL’s aim is to modernize the Indian railway infrastructure.

Record-Breaking Share Performance

Immediately after this news release came out, RVNL shares on National Stock Exchange (NSE) reached a brand new all-time high of Rs 345.90. The market believes in RVNL’s strategy and directions for future growth.

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Strategic Initiatives and Projects

Electric Traction System Upgradation

For upgrading the electric traction system from 1×25 KV to 2×25 KV for Khargpur – Bhadrak section, RVNL received Letter of Acceptance (LoA) from South Eastern Railway. This project will cater to a loading target of about 3000 MT underlining RVNL’s expertise in rail transport efficiency improvement.

Leadership Appointment

In a significant leadership development, H.E., the President of India has appointed NC Karmali as Part-time Government Nominee Director on the Board of Rail Vikas Nilgiri Ltd., with immediate effect till he holds the post of Executive Director/Gati Shakti- Railway Board or until further orders whichever is earlier. This will be instrumental in strengthening leadership at board level and giving strategic direction to RVNL.

Financial Performance

Impressive Quarterly Results

RVNL’s net profit rose by 33.2 per cent YoY to Rs 478.6 crore in Q4FY24. Revenue from operations increased by 17.4% YoY at Rs 6,714 crore indicating a healthy top line growth for the company. The EBITDA of RVNL reached Rs 456.4 crore thereby increasing its’ EBITDA margin by 21.8 per cent YoY while EBIDTA margin for the quarter stood at 6.8%.

Dividend Declaration

The Board of Directors of RVNL has recommended a final dividend of Rs 2.11 per equity share to reward its shareholders and also to indicate strong financial health.

Stock Performance

Year-to-date returns on shares of RVNL have been higher than those on Nifty by more than eighty-five times, equaling the latter’s market performance this year (3.6%). In addition, in the past twelve months, RVNL’s stock has returned an approximate multibagger return of about 192% versus Nifty’s about twenty-three percent one-year return; therefore, it is clear that investors believe in RVNL because of its expansion scope and strategic importance.

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Conclusion

Rail Vikas Nigam Limited (RVNL) continues to fuel growth through strategic railway projects and prudent financial management measures such as substantial order wins, solid financial performances, as well as effective leadership in place. RVNL is on track for sustainable growth and value creation with strong order backlog, robust balance sheet and quality leadership.This will see the company continue contributing towards India’s rail network infrastructure development and overall economic progress in general.Investors can expect further improvements in terms of railway infrastructure development and economic growth brought about by Rail Vikas Nigam Ltd.’s existence respectively.Therefore, Rail Vikas Nigam Limited is expected to continue its growth trajectory on the back of strong order book, sound balance sheet and quality leadership.

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