RailTel Corporation bags order from Tamil Nadu State Marketing Corporation

RailTel was established in the year 2000 to establish a nationwide broadband and VPN services, telecom, and multimedia network. Its purpose is to modernize the train control operation and safety system of the Indian Railways. RailTel is categorized as a “Miniratna” Public Sector Enterprise (PSE) under the Government of India. Currently, RailTel’s extensive network extends to approximately 6,000 stations across the country, encompassing all major commercial centres. 

On June 27, 2023, RailTel Corporation of India announced that it has been awarded a work order by Tamil Nadu State Marketing Corporation Ltd, known as “TASMAC,” for the implementation of an Integrated Solution project. The project aims to computerize and connect all core and support functions of TASMAC for 5 years. The order was awarded through an open tender process and is valued at Rs 294.37 crore.

Furthermore, the company recently announced the Q4FY23 results in which sales of the company surged by 51% to Rs 704 crore while operating profit grew by 2.08% to Rs 98 crore. Similarly, the net profit of the company grew by 40.7% to Rs 76 crore as compared to Q4FY22. Additionally, the company has been maintaining a healthy sales growth of 20% (CAGR) for the past 3 years and a profit growth of 3% (CAGR) over the same period. 

The company has delivered great returns of 44.73% over the past year and negative returns of 15% from the date of its listing in March 2021. Additionally, the company has a ROCE of 16.3% and a ROE of 12%. Moreover, the company has been maintaining a healthy dividend payout ratio of 37.3%. Furthermore, the company has a PE of 22.5x while the industry PE is 45.4x. 

On Wednesday, shares of the company surged by 1.50% to trade at Rs 135.10. 

Disclaimer: This blog is exclusively for educational purposes. The securities quoted are exemplary and are not recommendatory.