Rail Vikas Nigam Ltd (RVNL) plays a crucial role in India’s railway infrastructure development. The company has a strong order book, but its execution pace and revenue growth remain key factors to watch.

In Q3, RVNL reported a 13% decline in profit after tax (YoY) and a 3% drop in revenue. The company's operating margin stood at 5.2%, nearly flat compared to the previous year. Many projects remain in the early stages, awaiting regulatory approvals, which has slowed execution progress.

For FY25 and FY26, RVNL has projected flat revenue growth, signaling potential challenges in its earnings trajectory.

Order Book Strength & Execution Challenges

RVNL has secured orders worth ₹25,000 crore, pushing its total order book to ₹97,000 crore. While 49% of projects were awarded via direct nominations, 51% were secured through competitive bidding. The company is also expanding its global presence, with ₹4,500 crore worth of international orders.

Despite this strong order book, execution challenges persist. The much-awaited Vande Bharat train order is delayed due to design finalization, pushing the first prototype to 1H CY26 instead of the earlier 2H CY25.

Long-Term Growth Prospects

RVNL’s past execution strength positions it well for long-term growth, but near-term challenges include execution delays and revenue stagnation. Investors should monitor the company’s ability to accelerate project completion and secure high-value contracts.

The company’s strategic expansion into international markets and large-scale railway projects could drive future earnings growth if executed efficiently.