It looks like Rail Vikas Nigam Ltd (RVNL) shares are having a good run in the market. If you have stayed updated with its financial performance, you must be aware of its Q4FY24 results, which were announced recently. The Indian Railways’ construction arm registered a net profit of ₹478.4 crore, up 33% from ₹358.5 crore in the same period a year ago. The company’s stock price recently hit an all-time high, jumping over 15% in a single day!
The market for RVNL opened at ₹304.74, which is already ₹5.09 higher than the previous day’s closing price. But that wasn’t all. The stock continued to climb throughout the day, reaching a new 52-week high of ₹345.70, representing a gain of around 15.37%. The positive numbers come despite the stock’s 52-week low of ₹110.50 earlier in the year.
So what’s causing this big spike in its numbers? Let’s take a closer look at the 4 reasons.
Big Order From South Eastern Railways
The top reason is RVNL’s announcement of receiving a major order from the South Eastern Railways to upgrade their electric traction system. This project is worth more than a whopping ₹148 crore and is expected to be completed within 18 months, including its design, supply, erection, testing, and commissioning. This proved to be big news for the company, reflected in the stock price, which jumped big-time.
The order from South Eastern Railway’s Kharagpur division plans to meet its 3000 MT loading Target and upgrade its electric traction system from 1 x 25 KV to 2 x 25 KV for the Kharagpur (Excl.)-Bhadrak (Excl.) segment.
Strong Financials in Q4FY24
The recent stock price jump isn’t just due to the above new order. RVNL also released its financial results for the March quarter and full year 2024. Their consolidated revenue grew by 17.4% to ₹6,714 crore compared to last year. Profit After Tax (PAT) also witnessed significant growth, increasing by 33.2% to ₹478.6 crore. The company’s profit margin improved slightly, from 6.6% to 6.8%.
RVNL Track Record and Performance
RVNL’s stock price has multiplied in the past year. In 2024 alone, it has shot up over 85%, outperforming the broader market Nifty 50 index. The company has continued on this hot streak for the past three years with a return of more than 1000%, with the scrip gaining over 967% in two years and 192% in one year. So far this year, the shares of RVNL are up by around 86%.
Dividend Yields
Along with a strong year financially (2023-24), RVNL’s Board also recommended a Final Dividend of ₹2.11 per share (i.e., 21.10%) on the paid-up equity share capital for the financial year 2023-24. This news and the company’s history of consistent dividends suggest financial stability and profitability.
Regardless of a company’s financial performance, conducting thorough market research and consulting with financial professionals is crucial before making investment decisions. These steps will help ensure your investments align with your financial goals and risk tolerance.
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I’m Archana R. Chettiar, an experienced content creator with
an affinity for writing on personal finance and other financial content. I
love to write on equity investing, retirement, managing money, and more.
