The company, which is involved in the execution of various railway projects such as high-speed rail corridors, metro rail systems, and dedicated freight corridors, has been witnessing a strong growth in its revenue and profitability. The company posted a net profit of Rs 394 crore for the quarter ended September 30, 2023, up by 3.42 percent year-on-year, on the back of higher revenue and lower expenses. The revenue from operations increased by 0.11 percent year-on-year to Rs 4,914 crore, while the operating expenses declined by 13.58 percent year-on-year to Rs 794 crore.
The company also has a healthy balance sheet, with a debt-to-equity ratio of 0.07 and a return on equity of 23.22 percent. The company’s dividend yield is 1.16 percent, which is higher than the sector average of 0.83 percent. The company has been consistently paying dividends since its listing in 2019.
The company’s stock price has risen by over 200 percent in the past one year, reflecting the strong growth prospects and the favourable policy environment for the railway sector. The company’s valuation is also attractive, as it trades at a price-to-earnings ratio of 25.83, which is lower than the sector average of 43.43. The company’s price-to-book ratio is 5.97, which is higher than the sector average of 2.86, but justified by its superior return on equity.
The company’s future outlook is also positive, as it has a large and diversified order book, which provides revenue visibility for the next four to five years. The company has been awarded several projects by the Ministry of Railways, such as the Mumbai-Ahmedabad high-speed rail corridor, the Delhi-Meerut regional rapid transit system, and the dedicated freight corridors. The company is also expected to benefit from the government’s focus on infrastructure development and the increased allocation for the railway sector in the budget.
