RVNL to execute Rs 78K cr projects in three years

It hopes to complete railway projects worth Rs 9,000 crore in 2019

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IPO-bound Rail Vikas Nigam (RVNL) said it expects to execute its current order book size of Rs 77,500 crore in another three years time. In the current year itself, the public sector enterprise is looking at executing half a dozen railway projects.

“Six projects are getting completed this year. Next year, we are planning to complete 11 projects,” said Pradeep Gaur, CMD, RVNL.

During this calendar year, the company says projects worth around Rs 9,000 crore will be completed and handed over to Indian Railways for revenue operations. Among the projects that are nearing completion includes track doubling of Gaund-Gulbarga line covering a length of 224.90 km.

In the next two to three years, RVNL hopes to execute all the existing projects (order book).

Of the total order book position, projects worth around Rs 40,000 crore are having a short-term gestation period, while the balance projects are of a long-term gestation period.

A major chunk of this miniratna company’s revenue comes from doubling of railway lines, followed by laying of new lines and railway electrification. For example, during FY2018, of the Rs 7,597.3 crore revenue earned from operations, 44.9% came from doubling of railway lines while 26.3% accounted for projects related to laying new rail tracks with 9.9% coming in from the electrification of rail lines.

Likewise, during the first half of the current fiscal (FY19), the share of revenue from laying of second railway track increased to 49.7%.

Though the company claims that its CAGR has been improving over the years from Rs 3,269.8 crore in FY2015 to Rs 7,822.3 crore in FY2018 and Rs 3,770.4 crore in the first half of FY2019, RVNL’s net profit margin, however, has continuously narrowed. In FY2015, the net profit margin was 10.7% that narrowed to 9.5% in the subsequent year. Between FY2017 to H1 FY2019, the net profit margin further shrunk from 7.5% to 7%.

RVNL’s initial public offer (IPO) is scheduled to open on Friday and the issue will close of April 3. The issue has a price band of Rs 17 to Rs 19 per share. A discount equivalent to 50 paise per equity share on the offer price shall be offered to retail individual bidders and eligible employee bidders, respectively.

The IPO will be an offer for sale comprising up to 25.34 crore equity shares.


  • Rs 78k cr Co’s current order book position
  • Rs 40K cr Projects having a short-term gestation period
  • Rs 482 cr Company plans to raise through IPO
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