Railtel Corporation Shares Surge 10% After Securing ₹80 Crore MHADA Order

Railtel Corporation of India saw its shares jump by 10% to ₹449 in Wednesday’s afternoon trade following the announcement of a new contract win. The company secured a ₹79.8 crore order from the Maharashtra Housing and Area Development Authority (MHADA) to establish, migrate, and manage cloud-based data centres and disaster recovery sites.

The announcement provided a positive boost to Railtel’s stock price, which had declined by 21% over the last three months. The order from MHADA marks a significant milestone for Railtel as it continues to expand its reach in cloud-based infrastructure services, further strengthening its role as a key player in India's telecom and IT sectors.

Railtel's recent elevation to 'Navratna' status by the Indian government on August 30, 2024, reflects its strong financial and operational performance. This status provides the company with greater autonomy in decision-making and allows it to pursue new business opportunities with enhanced operational freedom. The company's annual turnover for FY24 stood at ₹2,622 crore, while net profit reached ₹246 crore.

In addition to this recent contract, Railtel secured another large order in September 2024, valued at ₹156 crore, from Maharashtra Rural Development. The order involves operationalizing ASSK-GP projects across the Konkan, Pune, and Nashik regions, further expanding Railtel's service portfolio and its involvement in large-scale public infrastructure projects.

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Railtel has shown robust financial performance in the current fiscal year. For the quarter ending June 2024, the company posted a 25.2% year-on-year rise in net profit, reaching ₹48.7 crore, while its revenue from operations grew by 19.4% to ₹558.1 crore. These results highlight Railtel’s ability to deliver consistent growth despite market volatility.

Looking ahead, Railtel expects to see continued strong growth in its telecom and project revenues. The company forecasts telecom revenue to grow by 9-10% for the current fiscal year, while project revenue is expected to reach ₹2,000 crore, contributing to overall revenue growth of 25-30% in FY25.

At around 12:50 PM on October 16, shares of Railtel were trading at ₹440, representing an 8% increase from the previous close on the NSE. Investors have responded positively to the company’s strategic moves, including its diversification into new markets and its successful execution of major contracts.

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Railtel’s ongoing projects, including cloud management services for MHADA and rural development initiatives in Maharashtra, are likely to boost its revenue streams and strengthen its position as a leading telecom and IT infrastructure provider. The company's future looks promising as it continues to expand its footprint in both the public and private sectors.