Navratna PSU stock jumps 3% after securing ₹141 Cr order from Min. of Defence

Synopsis: RailTel shares rose 3% following a Ministry of Defence work order. The ₹140.71 crore contract is for providing services under an Annual Maintenance Contract (AMC), and the execution of the order is scheduled on January 30, 2031.

The shares of Navratna PSU, which specializes in offering a wide range of services, including data communication, network management, system integration, and more, are in focus after securing a work order worth Rs. 141 Crores from the Ministry of Defence.

With a market capitalization of Rs. 10,724.16 Crores on Thursday, the shares of RailTel Corporation of India Ltd jumped upto 3 percent, reaching a high of Rs. 338.00 compared to its previous closing price of Rs.  327.90.

RailTel Corporation of India Ltd, engaged in offering a wide range of services, including data communication, network management, system integration, and more, has received a work order from the Ministry of Defence.

The order is for providing services under an Annual Maintenance Contract (AMC). The contract, valued at Rs. 140.71 crores, is to be executed domestically and is not a related party transaction and the work order execution is scheduled for January 30, 2031.

Financials

The company’s revenue rose by 12.79 percent from Rs. 843 crores to Rs. 951 crores in Q2FY25-26. Meanwhile, Net profit rose from Rs. 73 crores to Rs. 76 crores in the same period.

The company demonstrates solid financial health, highlighted by a ROCE of 21.8% and a ROE of 16.5%, indicating efficient use of capital and equity to generate profits. Its debt-to-equity ratio of 0.03 reflects a very low reliance on debt, keeping financial risk minimal, while a consistent dividend payout of 37% shows a commitment to returning value to shareholders.

Over the last decade, the company has achieved a median sales growth of 18.8%, showcasing steady and sustainable revenue expansion. This combination of strong profitability, low leverage, and consistent growth positions the company as financially stable and attractive for long-term investors.

RailTel Corporation of India Ltd. is a Navratna Public Sector Undertaking under the Ministry of Railways, Government of India, and is one of the largest neutral telecom infrastructure providers in the country. Established in September 2000, RailTel was created to modernise the train control, operation, and safety systems of Indian Railways by deploying an extensive nationwide broadband, telecom, and multimedia network.

The company’s service portfolio includes broadband, VPN, HD video conferencing, data center operations, cyber security, tower colocation, station Wi-Fi, hospital management information systems, and various ICT solutions for government and private institutions.

RailTel Corporation of India Ltd’s order book stands strong at Rs. 8,251 crore, providing healthy revenue visibility. Orders worth Rs. 3,317 crore received in the current financial year till September 2025 already exceed the entire FY24–25 inflows and are nearly three times the orders secured in H1 FY24–25, signalling sharp momentum in project wins.

The company’s data centre business is entering a strong expansion phase. With a current capacity of around 5 MW, the company plans to scale beyond 10 MW, demonstrating confidence in demand. Right now, revenues from data centres are Rs. 150 crore and are expected to grow 30–40 percent year-on-year, making data centres a key medium-term growth driver.

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