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RVNL - Research Report

RVNL - Research Report

Rail Vikas Nigam Limited (RVNL) is an A /T+1 group Civil Construction company with having Face value of Rs 10.00. RVNL The Company was incorporated with an objective to undertake rail project development mobilization of financial resources and implementation of rail projects pertaining to strengthening of golden quadrilateral and port connectivity Currently the Company is into the business of executing and implementing all types of rail infrastructure projects including new lines doubling (including 3rd/4th lines) gauge conversion railway electrification metro projects workshops major bridges construction of cable stayed bridges production units institution buildings and sharing of freight revenue with Railways as per the concession agreement entered into with Ministry of Railways.

Fundamentals (FY22-23):

 

CMP

Rs.76

52 - week high

Rs. 84.15

52 – week low

Rs 29.00

Dividend % (consolidated)

18.30 %

ROCE

16.33  %

BVPS

29.54

Revenue

19381.71 cr.

Debt to Equity

1.04

P/E ratio

12.83

EPS

5.93

P/B ratio

2.58

Market Cap

15,867 cr.

Face value

Rs. 10.0

 

 

 

Financial Results:

Company’s Net Sales was at Rs 4,908.90 crore in September 2022 up by 21.94%, Quarterly Net Profit at Rs. 381.22 crore in September 2022 up by 36.52% and EBITDA stands at Rs. 537.92 crore in September 2022 up by 90.21% compared to September 2021.

List of recent updates regarding the company:

  1. Since the inception in 2003 MoR has transferred 172 projects to Rail Vikas of which 166 projects are sanctioned for execution out of that 60 projects have been fully completed totaling to Rs. 167777.00 million and the balance are ongoing.
  2. RVNL recently received its letter of acceptance from Southern Railway for provision of automatic block signaling in the Taduku-Renigunta section in the Southern Railway. The project cost is worth Rs 38.97 crore. The project would be completed in 15 months.
  3. The company also bagged a Chennai Metro Rail project worth of Rs 1,134 crore and the project has to be completed in 1,065 days. The rail infrastructure company will construct an elevated viaduct, nine elevated metro stations, and a stabling viaduct.
  4. Rail Vikas Nigam Ltd (RVNL) has emerged as the lowest bidder for two metro projects from Gujarat Metro Rail Corp Ltd (GMRCL) in which it has participated with Siemens India with partnership of 65-35 respectively. Project’s cost is estimated at Rs 1,058.1 crore which includes complete work for the first phase of the Surat Metro Rail Project and the second phase of the Ahmedabad Metro Rail Project.
  5. Earlier in January, 2023 RVNL has also bagged a project worth Rs 166 crore from Gujarat Metro Rail Corporation (GMRC) and project worth Rs 1,035 crore order for Indore Metro Rail project from Madhya Pradesh Metro Rail Corporation.
  6. Rail Vikas Nigam Limited has signed MoU with National Highways Authority of India (NHAI) in connection with Construction of Multi Modal Logistics Parks across PAN India under Bharatmala Pariyojana. In this connection, Rail Vikas Nigam Limited (RVNL) has formed two JVs viz., BENGALURU MMLP PRIVATE LIMITED and CHENNAI MMLP PRIVATE LIMITED for Development of Multi Modal Logistics Parks (MMLP) at Obalapura, in Bengaluru rural District in the State of Karnataka through Public Private Partnership on Design Build Finance Operate and Transfer (DBFOT) basis.
  7. Rail Vikas Nigam (RVNL) also received contract worth Rs 198 crore for construction of Bhesan Depot and workshop from Gujarat Metro Rail Corporation (GMRC).
  8. Rail Vikas Nigam (RVNL) is appointed as project implementation agency for implementation of the UTF (Uthuru Thila Falhu-Island) Harbour project in Maldives. The project costs is Rs 1544.60 crore and it is to be completed within 24 months.
  9. Rail Vikas Nigam (RVNL) has also been awarded many contract by the National Highways Authority of India (NHAI) at an estimated value of the project is Rs 408 crore and Rs. 1844.77 crore respectively. The scope of work includes construction of four-lane highway from Samar Lakota to Achampeta Junction (for 12.25 km) as a part of Kakinada port to NH – 16 connectivity in the state of Andhra Pradesh under Bharatmala Pariyojana on EPC mode and construction of 4-laning of NH-5 from Kaithlighat to Shakral Village in Himachal Pradesh on hybrid annuity mode.

In past three year the stock gave a return of 177.74% as compared to Sensex which gave a return of 46.23% and 178.24% return compared to 46.42% rise in Nifty.

Government also plans to increase Vande Bharat trains on many routes across the country after successfully running them on 7 to 8 routes on pilot stages and RVNL may get benefited through this initiative. Govt of India is also focusing on improving the efficiency in movement of cargo across the country by bridging critical infrastructure gaps and recently came out with Logistics Policy for Country through which Railway stocks may get benefited. the Railway Ministry is going to start operating Hydrogen trains along eight heritage routes on a mission mode. As part of the green initiative, the Railways Ministry is earmarking Rs 2,800 crore in the proposed rolling stock plan, in the upcoming budget and RVNL is in sweet spot to get benefitted through it. Considering the allocation made by the Government to the railways every year in budget, the company may range higher in upcoming years and will continue to contribute to its future growth too so, the stock is recommended for long term period.

- Het Zaveri

-info@smartinvestment.in

(Disclosures: At the time of writing this article, author, his clients & dependent family members may have positions in the stocks mentioned above. The author, his firm, his clients or any of his dependent family members may make purchases or sale of the securities mentioned in website. Author may have positions in above stocks so have vested interest obviously in their going up or down as the case may be.

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