RITES surges after Q2 profit doubles

RITES announced a stellar Q2 2019 earnings after market hours yesterday.

The public sector enterprise reported a 112% jump in consolidated profit after tax to Rs 237 crore on YoY basis. Consolidated total revenue rose 85.8% to Rs 888 crore in Q2 2019 over Q2 2018.

Consolidated EBITDA jumped 84% to Rs 339 crore in Q2FY19 over Q2FY18.

On standalone basis, company's net profit advanced 115% to Rs 233 crore on a 88.2% rise in total revenue to Rs 874 crore in Q2 September 2019 over Q2 September 2018.

Consultancy business reported lower revenue largely due to prolonged monsoon affecting project management consultancy fee and some projects not reaching their billing stage. Revenue from consultancy business declined 10.21% to Rs 255 crore on YoY basis. Leasing business has shown a growth of 23.8% over Q2FY19 with revenue of Rs 30 crore as against revenue of Rs 24 crore. Exports revenue during the Q2FY20 stood at Rs 262 crore against Q2FY19 exports of Rs 1 crore.

The company's order book as of 30 September 2019 stands at Rs 5833 crore.

The company gave an optimistic outlook for financial year 2020. The company said standalone operating profit margin target is 23.20% of operating revenue.

Commenting on the results, Rajeev Mehrotra, chairman and managing director, RITES said, "RITES has reported its highest ever quarterly and half yearly performance driven by growth in exports, turnkey works and leasing. Our focus on exports has been productive and we are seeing steady upward momentum from clients."

Shares of RITES were trading 3.4% higher at Rs 296.80 on BSE.

RITES is a public sector enterprise (PSE) and a leading player in the transport consultancy and engineering sector in India, having diversified services and geographical reach.

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