ET Intelligence Group: The gvernment plans to garner up to Rs 482 crore by offloading 12.2 per cent stake in mini-ratna PSU Rail Vikas Nigam (RVN) through an offer for sale (OFS). Given a higher dependence on the government orders and possible payment delays, long-term investors may wait for a listing before taking an investment decision.
BUSINESS
RVN works as an project executing agency for the Ministry of Railways (MoR). Since its inception in 2003, the railway mi ..
The company charges fixed fee from contractors to execute projects including constructing new lines, gauge conversion, railway electrification, metro projects, workshops, construction of cable stayed bridges and institution buildings. For metro projects, the company charges fixed fee of 9.25 per cent and for national projects, it charges of 10 per cent fee. For other projects, it charges fees of 8.5 per cent.
RVN has order book of little over Rs 77,504 crore as of December 31, 2018, which includes 102 ongoing projects.
In the first half of a fiscal, the company derives 40-45 per cent of its revenues and in the remaining half, the company derives 55-60 per cent
FINANCIALS
In the past three years, the company’s revenue grew by 34 per cent annually to Rs 7,597 crore and net profit rose by 19 per cent to Rs 570 crore. Its debt-equity ratio as of first half of FY19 was 0.5 and cash and bank balance on the book was Rs 1,272 crore.
VALUATION
At the higher end of the price band of Rs 17-19, RVN’s price-earnings multiple (P/E) works out to be 6.3 after annualising net profit for the six months to September 201 ..
BUSINESS
RVN works as an project executing agency for the Ministry of Railways (MoR). Since its inception in 2003, the railway mi ..
The company charges fixed fee from contractors to execute projects including constructing new lines, gauge conversion, railway electrification, metro projects, workshops, construction of cable stayed bridges and institution buildings. For metro projects, the company charges fixed fee of 9.25 per cent and for national projects, it charges of 10 per cent fee. For other projects, it charges fees of 8.5 per cent.
RVN has order book of little over Rs 77,504 crore as of December 31, 2018, which includes 102 ongoing projects.
In the first half of a fiscal, the company derives 40-45 per cent of its revenues and in the remaining half, the company derives 55-60 per cent
FINANCIALS
In the past three years, the company’s revenue grew by 34 per cent annually to Rs 7,597 crore and net profit rose by 19 per cent to Rs 570 crore. Its debt-equity ratio as of first half of FY19 was 0.5 and cash and bank balance on the book was Rs 1,272 crore.
VALUATION
At the higher end of the price band of Rs 17-19, RVN’s price-earnings multiple (P/E) works out to be 6.3 after annualising net profit for the six months to September 201 ..
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