RITES shares gain 4%, snap two-day losing streak after Rs 297-cr order win

RITES shares have corrected 15 percent in the last three months.

Shares of RITES rallied over 4 percent to Rs 309 in morning trade on December 16, snapping its two-day losing streak, after the state-run engineering firm announced it has secured a contract worth Rs 297.67 crore from the Ministry of External Affairs (MEA).

In a regulatory filing, the company stated, "We are pleased to inform you that RITES has received work for Project Implementation Services for the construction of an Integrated Check Post (ICP) from the Ministry of External Affairs, Government of India."

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The project, which includes construction and Project Management Consultancy (PMC) fees but excludes GST, is expected to be completed within 59 months, including the defect liability period.

This is the company's second order in a week. RITES secured a significant project from the Indian Institute of Management (IIM) in Raipur. The order, valued at Rs 148.25 crore (excluding GST), involves RITES serving as the Project Management Consultant (PMC) for the development of Phase II of the institute's campus in Chhattisgarh. The scope of the project includes execution, supervision, monitoring, and development, to be completed on a cost-plus basis within a timeline of 23 months.

Meanwhile, RITES reported a 25 percent year-on-year decline in net profit for the quarter, which stood at Rs 82.5 crore compared to Rs 110.2 crore in the same period last year. Revenue for the quarter fell 7.1 percent to Rs 541 crore, down from Rs 582.4 crore a year ago.

The company's Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) also dropped 23 percent year-on-year to Rs 106.4 crore, compared to Rs 138 crore last year. The EBITDA margin narrowed to 19.7 percent from 23.6 percent in the corresponding period last year.

At about 10:15 am, shares of the company were trading at Rs 306, higher by 2.5 percent from the last close on the NSE. RITES shares have corrected 15 percent in the last three months.