⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
RVNL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.2
| Stock Code | RVNL | Market Cap | 68,116 Cr. | Current Price | 327 ₹ | High / Low | 448 ₹ |
| Stock P/E | 68.6 | Book Value | 41.2 ₹ | Dividend Yield | 0.53 % | ROCE | 15.0 % |
| ROE | 14.4 % | Face Value | 10.0 ₹ | DMA 50 | 334 ₹ | DMA 200 | 350 ₹ |
| Chg in FII Hold | 0.31 % | Chg in DII Hold | -0.02 % | PAT Qtr | 196 Cr. | PAT Prev Qtr | 128 Cr. |
| RSI | 45.4 | MACD | -0.93 | Volume | 3,79,41,773 | Avg Vol 1Wk | 2,05,72,536 |
| Low price | 295 ₹ | High price | 448 ₹ | PEG Ratio | 22.8 | Debt to equity | 0.56 |
| 52w Index | 20.5 % | Qtr Profit Var | -35.2 % | EPS | 4.76 ₹ | Industry PE | 16.9 |
📊 Core Financials
- Revenue & Profitability: Quarterly PAT at ₹196 Cr, up from ₹128 Cr sequentially, but YoY profit variation shows -35.2% decline. EPS at ₹4.76 is modest relative to market cap.
- Margins: ROE at 14.4% and ROCE at 15.0% reflect decent efficiency but not industry-leading.
- Debt Ratios: Debt-to-equity at 0.56 is moderate, manageable but worth monitoring.
- Cash Flows: Stable operating cash flows implied by profitability and moderate leverage.
💹 Valuation Indicators
- P/E Ratio: 68.6, far above industry average of 16.9, suggesting significant overvaluation.
- P/B Ratio: Current price ₹327 vs. book value ₹41.2 → ~7.9x, expensive relative to assets.
- PEG Ratio: 22.8, very high, indicating valuation is stretched compared to growth prospects.
- Intrinsic Value: Current valuation exceeds intrinsic worth, offering little margin of safety.
🏢 Business Model & Competitive Advantage
- Rail Vikas Nigam Ltd (RVNL) operates in railway infrastructure development, executing government-backed projects.
- Competitive advantage lies in government contracts, execution expertise, and strong order book visibility.
- Business model benefits from infrastructure expansion but profitability remains cyclical and project-dependent.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Safer accumulation range between ₹295 – ₹310, closer to 52-week low and below DMA200.
- Long-Term Holding: Suitable for investors betting on railway infrastructure growth, though current valuation is expensive. Best to accumulate on dips.
✅ Positive
- Sequential PAT growth from ₹128 Cr to ₹196 Cr.
- ROE at 14.4% and ROCE at 15% reflect decent efficiency.
- FII holding increased (+0.31%), showing foreign investor confidence.
⚠️ Limitation
- High P/E ratio compared to industry average.
- PEG ratio of 22.8 suggests stretched valuation.
- Dividend yield of 0.53% is modest.
📉 Company Negative News
- YoY profit variation of -35.2% highlights earnings instability.
- DII holding decreased (-0.02%), showing reduced domestic institutional confidence.
- Stock trading below DMA200 indicates weak momentum.
📈 Company Positive News
- Sequential PAT improvement indicates short-term recovery.
- Strong 52-week performance with 20.5% gain.
- EPS at ₹4.76 reflects consistent earnings power.
🏭 Industry
- Railway infrastructure sector trades at industry PE of 16.9, much lower than RVNL’s 68.6, showing premium valuation.
- Sector growth supported by government infrastructure push and railway expansion.
🔎 Conclusion
- RVNL is financially stable with government-backed projects and decent efficiency ratios.
- Valuation is stretched, limiting near-term upside, but long-term prospects remain positive given infrastructure growth.
- Best suited for long-term investors with entry around ₹295 – ₹310 offering a better margin of safety.
I can also prepare a comparative HTML snapshot of RVNL versus IRCON International to highlight valuation and profitability differences in the railway infrastructure sector.