Rail Vikas Nigam Ltd (RVNL) has emerged as the lowest bidder for a ₹335.4 crore Kavach contract from South Western Railway. Despite this win, RVNL reported a 27% YoY decline in net profit for Q3 FY25.
Rail Vikas Nigam Ltd (RVNL), a state-owned company, announced on Monday (February 10) that it has emerged as the lowest bidder (L1) for a ₹335.4 crore contract from South Western Railway.
The contract involves the survey, design, supply, installation, testing, and commissioning of Kavach equipment, along with other related works across 790 route km (RKM) in the Hubballi and Mysuru divisions.
In a regulatory filing, RVNL confirmed its position as the L1 bidder, stating that the work will enhance railway safety by implementing the Kavach system.
Kavach is an automatic train protection (ATP) system designed to prevent train collisions and regulate speed, significantly improving railway safety. Despite this new contract win, shares of RVNL closed at ₹381.30, down by ₹14.05 or 3.55% on the BSE.
For Q3 FY25, RVNL reported a 27% year-on-year (YoY) decline in net profit, dropping to ₹286.9 crore from ₹394.3 crore in the same period last year.
This decrease was mainly due to reduced operating margins and lower earnings. Revenue from operations also declined by 1.2% YoY to ₹4,855 crore, compared to ₹4,914.3 crore in Q2 FY24. EBITDA fell by 9% to ₹271.5 crore, and margins narrowed to 5.6% from 6% in the previous year, indicating mounting operational challenges.
However, RVNL did show improvement on a quarter-on-quarter (QoQ) basis, with profits rising by 28.1% and revenue increasing by 19.2% in Q2 FY25, suggesting a sequential recovery.
Rail Vikas Nigam’s share price traded at ₹370.35 at 10:10 AM on the NSE, showing a decline of ₹11.10 or 2.91% from its previous close of ₹381.45. The stock opened at ₹383.00 and reached a high of ₹385.75, but later dropped to a low of ₹370.15.
The stock price of Rail Vikas Nigam Limited extended its previous two sessions of losses, falling by nearly 2.5% today.
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Published on: Feb 11, 2025, 10:15 AM IST
Neha Dubey
Neha Dubey is a Content Analyst with 3 years of experience in financial journalism, having written for a leading newswire agency and multiple newspapers. At Angel One, she creates daily content on finance and the economy. Neha holds a degree in Economics and a Master’s in Journalism.
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