Rs 1,00,000 Crore Order Book & 1,900 Per Cent 5-Year Multibagger Returns: Railway Infrastructure Company Secures Rs 213 Crore Railway Electrification Project

The stock gave multibagger returns of 260 per cent in just 2 years and a whopping 2,324 per cent in 5 years.

Rail Vikas Nigam Limited (RVNL), a Government of India Enterprise, has emerged as the Lowest Bidder (L1) for a significant project awarded by the South Central Railway. This contract, falling under the normal course of the company's business, involves the "Design, Supply, Erection, Testing and Commissioning for OHE upgradation of existing 1X25kV system to 2X25kV AT feeding system with feeder and earthing works in Duvvada-Rajahmundry & Samalkot-Kakinada Port section of Vijayawada Division under South Central Railway."

The project encompasses a total of 195.5 Running Track Kilometers (RKM) and 391 Track Kilometers (TKM). The tender number for this domestic contract is 2x25-DVD-RJY-SLO-COA. The broad consideration or size of the order is valued at an impressive Rs 2,13,22,48,546.62, inclusive of applicable taxes. The time period stipulated for the execution of this substantial order is 24 months.

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 March 31, 2024, RVNL has a strong order book of Rs 1,00,000 crore, focusing on railway, metro and overseas projects.

According to Quarterly Results, the net sales decreased by 4 per cent to Rs 6,4276 crore and net profit declined by 4 per cent to Rs 459 crore in Q4FY25 compared to Q4FY24. In its annual results, the net sales decreased by 9 per cent to Rs 19,923 crore and net profit increased by 19 per cent to Rs 1,282 crore in FY25 compared to FY24. The company has a market cap of over Rs 85,000 crore and the shares of the company have an ROE of 14 per cent and an ROCE of 15 per cent. The Board has recommended a final dividend of Rs 1.72 per share (i.e. 17.20 per cent) on the paid-up equity share of face value of Rs 10 each of the company for the financial year 2024-25.

As of March 2024, the President of India owns a 72.84 per cent stake, and Life Insurance Corporation of India owns a 5.84 per cent stake. The stock gave multibagger returns of 219 per cent in just 2 years and a whopping 1,936 per cent in 5 years.

Disclaimer: The article is for informational purposes only and not investment advice.