Stock Market: The company had informed last week that it was the lowest bidder for another railway project. Following confirmation of its stake in this project, a positive reaction was observed among investors.
Rail Vikas Nigam Limited (RVNL) has received a new major project from Southern Railway. The company has been awarded this project related to the upgrade of the electric traction system, with a total cost of ₹143 crore. The company informed the stock market about this project on Saturday. Notably, the company has to execute this work in the Salem Division, which is to be completed in 24 months.
Again Wins in Railway Project
RVNL is continuously receiving important responsibilities in railway projects. Just last week, the company announced that it had become the lowest bidder for another project of Southern Railway. With the confirmation of this new order, it is clear that RVNL is constantly being given major responsibilities by the Railways. This has also increased the company's reputation.
Full details of the order
In its exchange filing, RVNL stated that it has been awarded the contract to upgrade the electric traction system in the Salem Division of Southern Railway. This contract is worth a total of ₹143 crore and is to be completed in 24 months, i.e., two years. Under this project, the existing electric infrastructure of the railways will be upgraded to improve both the speed and safety of trains.
Order also received from South Central Railway
Earlier, on June 27, RVNL had informed that it had placed the lowest bid for a project in the Vijayawada Division of South Central Railway. The value of this project is more than ₹213 crore and it also has to be completed in 24 months. The company is continuously strengthening its presence in the railway sector and this is rapidly increasing its order book.
Impact seen on the share
After the news of receiving the order on Saturday, it is expected that the company's shares may see increased activity in Monday's market. On Friday, RVNL's share closed at ₹391.35, with a slight increase. The share had also seen a slight rise earlier this week.
How has the share performed?
RVNL's shares have given good returns to investors in the past year. However, it is trading below its yearly high of ₹647. The yearly low is ₹295. A year ago, this share was trading above ₹500. But due to recent government projects and continuous orders, there is renewed hope for an increase.
Strong hold in the infrastructure sector
Rail Vikas Nigam is a public sector company under the Government of India. It was established to complete infrastructure projects related to railways in a time-bound manner. The company specializes in various works such as track construction, signaling, electrification, and bridge construction. In the past few years, the company has successfully completed many major projects, due to which it is continuously receiving new projects from the Ministry of Railways.
The order book is continuously increasing
RVNL's order book is continuously increasing. Since the beginning of this year, the company has received projects worth several hundred crores of rupees from various divisions. Apart from Southern Railway and South Central Railway, other zones have also awarded contracts to the company. This is expected to have a positive impact on the company's revenue and profits.
According to technical experts, the stock has found b resistance near ₹400. If the pace of orders received by the company continues like this, then a new surge can be seen in it. For now, investors' eyes will be on Monday's trading session as it will be important to see how the market views this latest order.
Investors' eyes now on the new order
Investors are now keeping an eye on the company's next move. The company already has a large order book and the pace of receiving new projects continues. It is also expected in the market that if the next quarterly results are good, the stock may return to its old high.
