RVNL share price: Rail Vikas Nigam Limited (RVNL) shares have been nosediving for two straight sessions after the weak Q1 results in 2024. In two successive sessions, RVNL share price has tanked from around ₹566 apiece to ₹515 on the NSE, recording a nearly 9 per cent correction in this period. However, stock market experts believe a dip in RVNL shares is an opportunity for long-term investors. The railway PSU did not perform in the first quarter of the current fiscal due to policy paralysis during the Lok Sabha elections. They said that RVNL may recover from the next quarter as the new government has been formed after the Lok Sabha election results. They advised RVNL shareholders to accumulate on every 5-7 per cent dip from current levels.
After losing around 5 per cent on Thursday, RVNL's share price today opened with a downside gap at ₹538 and made an intraday low of ₹515.40 per share on the NSE, recording a 9 per cent dip from its Wednesday close of around ₹566 apiece.
Speaking on the reason for continuous selling in RVNL shares, Seema Srivastava, Research Analyst at SMC Global Securities, said, “RVNL shares are nosediving for the last two sessions due to the weak Q1 results. The PSU company has reported a big dip in the net profit and net income. Still, the state-owned railway company deserves the benefit of the doubt on the policy paralysis caused by the Lok Sabha elections during the first quarter of the current financial year. The company is expected to bounce back strongly after the inception of the Modi 3.0 government in the centre.”
Speaking on the outlook of RVNL shares, Ganesh Dongre, Senior Manager — Technical Research at Anand Rathi, said, "RVNL share price is in the falling pattern after the short term top being made on the technical chart. RVNL's share price is in the ₹495 to ₹590 range, and the stock may fall further if it breaches its current support, which is placed at ₹495. So, RVNL shareholders are advised to maintain the stop loss at ₹495 while the fresh investors are advised to wait for some time and allow the stock to stabilize."
"Once the stock stabilizes, one can accumulate RVNL shares on every 5-7 per cent dip. Those with a high-risk appetite can buy RVNL shares at the current price, maintaining a 'buy-on-dips' strategy. However, the strategy is for long-term investors only," said Seema Srivastava of SMC Global Securities.
RVNL reported a 35 per cent decline in its consolidated net profit for the first quarter ending June 2024, with earnings of ₹224 crore, compared to ₹343 crore in the same quarter last year.
Revenue from operations during the April-June 2024 period dropped by 27 per cent, reaching ₹4,074 crore, down from ₹5,572 crore in the corresponding period of the previous year.
EBITDA for the first quarter dropped 48 per cent year-on-year (YoY) to ₹189 crore, compared to ₹349 crore in the same quarter last year. Additionally, margins declined by 180 basis points year-on-year to 4.5 per cent.
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