RITES share price: 'Navratna' stock soars 8% on MoU with Etihad Rail

RITES share surged 8 per cent to Rs 324.70 on the BSE in Wednesday's intraday trade amid heavy volumes after the company said it has signed a Memorandum of Understanding (MoU) with Etihad Rail for rail infrastructure works in UAE.

RITES is a Navratna Public Sector Enterprise and a leading player in the transport consultancy and engineering sector in India, having diversified services and geographical reach. Etihad Rail is the developer and operator of the UAE National Rail Network. 

The MoU aims to explore cooperation and synergise strengths in developing railways and related infrastructure services in the UAE and wider region.

The partnership also aims at leveraging strengths of both the entities to explore collaborative opportunities for supply/leasing of rolling stock, consultancy and project management for railway projects, services such repairing of rolling stock and operation and maintenance of railway infrastructure to ensure more efficient and modernised rail services in the UAE and across the region, RITES said in exchange filing.

On Monday, October 7, RITES received a Letter of Award (LOA) for an order from Ntokoto Rail Holdings. The order is $5.4 million and is expected to be executed within 6 months. 

Last week, RITES signed a MoU with Delhi Metro Rail Corporation (DMRC), which is renowned for operating and maintaining Delhi's extensive metro rail network. Through this MoU, both the organisations will combine their strengths to identify, secure, and execute metro projects in India and abroad.

At 09:44 AM, RITES share price was trading 7 per cent higher at Rs 322.35 as compared to 0.24 per cent rise in the BSE Sensex. The counter saw a huge rise in trading volume with a combined 4.6 million equity shares changing hands on the NSE and BSE till the time of writing of this report. The stock had hit a 52-week high of Rs 413.08 on February 27, 2024.

RITES engages in almost all sector of infrastructure space from railways, highways, metros, urban engineering, sustainability, green mobility, airports, ports, ropeways, institutional buildings, inland waterways, freight terminal, Jal Jeevan Mission, multi modal transport and renewable energy. Over and above these consultancy services, RITES has a strong Quality Assurance vertical providing process and product inspections with lab facilities in place, a fleet of 75 locomotives and is also exporting rolling stock for over 30 years.

The company's ability to secure large-scale projects and its strategic expansion into international markets like Africa, Latin America, Middle East and Southeast Asia further enhance its growth prospects. Upcoming cross-country corridors, Africa's programme for infrastructure development, Latin America focus on closing infrastructure gaps and plans for enhancing connectivity between regional group like BIMSTEC and ASEAN in Aisa, opens vistas of opportunities for the Company and it is proactively working towards these opportunities, RITES said in its FY24 annual report.