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Rail Vikas Nigam hits 20% upper circuit after a tepid debut last week

The locked in upper circuit of 20 per cent at Rs 23.70 on BSE on Monday after listed par against its issue price of Rs 20 per share on Thursday.

SI Reporter  |  Mumbai 

A train trails on a snow-covered Srinagar-Banihal railway track following fresh snowfall, in Anantnag | Photo: PTI
A train trails on a snow-covered Srinagar-Banihal railway track following fresh snowfall, in Anantnag | Photo: PTI

Shares of Limited (RVNL) hit their upper circuit of 20 per cent at Rs 23.70 on the BSE on Monday after making a tepid debut last week.

The trading volumes jumped 1.5 times with a combined 90.5 million equity shares changing hands on the NSE and BSE till 3:03 pm. There were a combined pending buy orders for 2.24 million shares on both the exchanges, data shows.


The state-owned company’s stock price saw little change in the issue price on their stock market debut on Thursday. It ended at Rs 19.05 compared to price of Rs 19 per share. RVNL’s initial public offer (IPO) had garnered 1.7 times subscription. Retail investors were allotted shares at Rs 18.5 apiece.

Most analysts have assigned 'subscribe' rating to the IPO, given its robust executable order book, growth prospects, government focus on rail infrastructure spend and attractive valuation.

In the recent past, two Indian Railway entities - International (IRCON) and RITES (RITES) - debuted at the bourses. Of these, only RITES is trading above the price, while the former is trading at 16 per cent discount (as of Thursday's close) to the price.

"RITES predominantly is a consulting arm of Indian Railways, while is normally into project execution and can execute projects across the spectrum. Though both and RITES are not perfect peers to but can be considered as proxy peers as they majorly cater to Indian Railways," wrote analysts at Choice Research in the IPO note. READ MORE HERE

RVNL, a project executing agency working for and behalf on Ministry of Railways, executes railway projects including new lines, doubling, gauge conversion, railway electrification, metro projects, workshops, major bridges, cable-stayed bridges and buildings etc. It has an order book of Rs 77,500 crore. Of this, orders worth Rs 30,000 crore are long-gestation projects with execution timeline of five-seven years. Orders of nearly Rs 45,000 crore are related to doubling, new lines, etc, where execution timelines are two-three years.

First Published: Mon, April 15 2019. 15:18 IST
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