RVNL shares jump nearly 5% higher on securing multiple orders with its JV and Consortium worth ₹6,000 crore

The largest order received by the company was from BSNL, which will be executed by a consortium between RVNL-HFCL -and Aerial Telecom Services Ltd for the Development (Creation, upgrade and Operation & Maintenance) of the middle mile on Bharat Net. The contract is expected to be completed in 3 years and there after 10 years of maintenance on the same.

The broad contract size for the order stands at ₹5008 crore, for which the share of the order value is yet to be decided between the three entities of the consortium. The contract also includes maintenance orders after the completion of the project for the next 10 years, for which remuneration is pre-determined at 5.5% of the total capex for the first five years and 6.5% of the capex for the next five years.

The second contract was issued by Rail Infrastructure Development Company (Karnataka) for the construction of 9 stations of BSRP of corridor 4A at Heelalige, Singena Arghara, Huskur, Ambedkar Nagar, Carmelaram, Bellandur, Marathahalli, Doddanakundi, and Kaggadasapura. The above contract value stands at ₹613 crore, and it will be executed by a Joint Venture between RVNL(51%) and Rithwik Projects Ltd (49%).

The third order was received by RVNL and SCPL JV worth ₹837 crore from Eastern Railway Network. The JV emerged as the Lowest Bidder (L1) from Eastern Railway for ‘Earthwork in cutting and filling, blanketing, construction of minor bridges, major bridges, RUB, ROB, retaining wall, level crossing, side drain, catch water drain, P.way work and other ancillary works from IR Ch. 205.000 km to 260.2 Km between Kalipahari (inc.) to Pradhankhuta (exc.) in connection with construction of multi-tracking Railway BG line. The project cost is ₹837.67 crore. The said order is expected to be completed in 36 months.

Previously, the company also received a ₹283 crore order from East Coast Railway to construct the 3rd and 4th lines between Jarapada and Talcher Road and the new line between Angul and Balram and another order worth ₹186 crore.

Rail Vikas Nigam Limited is an extended arm of the Ministry of Railways. The company is in the business of executing all types of railway projects, including new lines, doubling, gauge conversion, railway electrification, metro projects, workshops, major bridges, construction of cable-stayed bridges, institution buildings, etc.

It generally works on a turnkey basis and undertakes the full cycle of project development from conceptualisation to commissioning, including stages of design, preparation of estimates, calling and award of contracts, project and contract management, etc. and all stages of project execution up to the stage of commissioning of the new railway lines.

Following the announcement, Rail Vikas Nigam's share price traded 4.7% higher on the NSE at ₹472 apiece. Even after a steep 30% correction from its all-time high, RVNL shares have given nearly 140% returns on a YTD basis and 188% returns on an annual basis.