Shares of RITES, formerly known as Rail India Technical and Economic Service, surged over 5% on Friday after the state-owned company under the Ministry of Railways secured orders worth $81,175,500 (or ₹664.73 crore) from National Railways of Zimbabwe. The PSU company has signed contract agreements with National Railways of Zimbabwe (NRZ) for the supply of rolling stock (3,000 hp diesel electric locomotives and high sided open wagons). The contract agreements are subject to approval of funding by the funding agency, the company said in an exchange filing today.
Boosted by the development, the railway-related stock gained as much as 5.3% to hit an intraday high of ₹398.95 on the BSE, while the market capitalisation increased to ₹9,538 crore. Early today, the stock opened at ₹384.80, up 1.6% against the previous closing price of ₹378.85. On the volume front, 1.23 shares changed hands over the counter as compared to two-week average volume of 0.61 lakh stocks.
RITES shares currently trades 8% lower than its 52-week high of ₹433.20 touched on November 4, 2022, and 76% higher than its 52-week low of ₹226.05 hit on June 20, 2022. It has delivered 70% returns in the last one year and 11% in a six-month period. In the last one month, the stock has given flat returns, while it gained 6% in a week.
“RITES has signed Contract Agreements with National Railways of Zimbabwe (NRZ) for supply of rolling stock (3000 HP Diesel Electric Locomotives and High Sided Open Wagons). However, the Contract Agreements are subject to approval of funding by the funding agency,” the company said in a BSE filing today.
For the March 2023 quarter, the Engineering services company posted 6.5% growth in profit after tax to ₹138 crore compared with ₹130 crore in the year-ago quarter. The operating revenue, excluding other income, fell 10.3% to ₹687 crore in the quarter under review, from ₹766 crore in Q4FY22, impacted by low exports.
The board of Miniratna company also recommended a final dividend of ₹6 per share amounting to ₹144 crore for FY23, which is 60% of the paid-up capital. With this, the total dividend payout ratio attributed for FY23 will stand at 92.8%.
The company has a strong track record of paying dividends as it declared 17 dividends since September, 2018. In the past 12 months, Rites has declared an equity dividend amounting to ₹18 per share. At the current share price, the dividend yield stands at 4.57%.
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