RVNL shares in focus after securing Rs 156-crore EPC contract from South Western Railway

Rail Vikas Nigam Ltd (RVNL) shares will be in focus on Friday after the state-owned company received a letter of acceptance from South Western Railway for an engineering, procurement, and construction (EPC) contract worth Rs 156.36 crore, including taxes.

The project involves the design, supply, erection, testing, and commissioning of a 2X25 KV overhead electrification (OHE) and power supply installation (PSI) system, along with electrical general services, engineering, and telecommunication works.

The contract covers the Rayadurga-Topavagada section of the TK-RDG railway line and is expected to be completed within 18 months.

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In February, RVNL secured a Rs 135.66-crore contract from Central Railway for the design, supply, erection, testing, and commissioning of 132/55 KV traction substations, sectioning posts (SPs), and sub-sectioning posts (SSPs) in the Bhusaval-Khandwa section. The EPC-mode project aims to enhance railway freight capacity and is expected to be completed within 24 months.

RVNL Q3 earnings

RVNL reported a 13.1% year-on-year (YoY) dip in net profit at Rs 311.6 crore for the third quarter that ended December 31, 2024. In the same period in FY24, the company saw a net profit of Rs 358.6 crore.

The railway PSU posted revenue from operations at Rs 4567 crore, a 2.6% YoY decline from Rs 4689 crore reported in Q3 FY24.

At the operating level, EBITDA (earnings before interest, tax, depreciation, and amortisation) was down 3.9% YoY to Rs 239.4 crore in Q3FY25 over Rs 249 crore. The EBITDA margin was largely flat at 5.2% compared to 5.3% in the corresponding period in the previous fiscal.

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RVNL shares target price

As per Trendlyne data, the average target price of the stock is Rs 357, which indicates an upside of 2% from the current market prices. The consensus recommendation from 2 analysts for the stock is a 'Sell'.

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RVNL shares performance

On Thursday, RVNL shares closed at Rs 350.4, down 3.5% on the BSE. The stock has declined 39% over the past six months but gained 472% in the last two years. The company’s market capitalization stands at Rs 73,069 crore.

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