Shares of Rail Vikas Nigam rallied as much as 5% in opening trade on Wednesday after the state-owned company received a letter of award for the appointment as project implementation agency for the implementation of the UTF harbour project in Maldives. This is a strategic project of the government and will cost ₹1,544.60 crore, the company said in a regulatory filing.

“Rail Vikas Nigam Limited (RVNL) has received a LOA on December 27, 2022, for appointment as project implementation agency for implementation of the UTF Harbor Project in Maldives. This is a strategic project of GOVT. of India. The project costs is ₹1544.60 crore,” the Mini-Ratna company said in a BSE filing on December 27.

The contract has been awarded by the Ministry of External Affairs (MEA) and time period for the completion of the project is 24 months.

Cheering the news, shares of Rail Vikas Nigam opened 2.7% higher at ₹65.25, against the previous closing price of ₹63.55 on the Bombay Stock Exchange (BSE).In the first hour of trade so far, the stock touched its upper price band of 5% at ₹66.70, while the market capitalisation rose to ₹13,823.7 crore. In comparison, the BSE Sensex was trading 79 points lower at 60,848 levels, paring opening losses.

In the calendar year 2022, Rail Vikas Nigam share price has given 87% return to its shareholders, while it has zoomed 118% in the past six months. However, the stock witnessed trend reversal in the recent time, with the share price falling 17% in a month and 1% in a week. The stock has retreated 21% from its 52-week high of ₹84.15 touched on November 29, 2022.  It hit a 52-week low of ₹29 on February 24, 2022.

In recent times, Rail Vikas Nigam, the infrastructure arm of Indian Railways, has secured a slew of projects. Last week, it received a contract worth ₹198 crore for construction of Bhesan Depot and workshop from Gujarat Metro Rail Corporation (GMRC). The project, which has to be executed within 20 months, covers construction of Bhesan Depot and workshop including DDC, BCC and associated electrical and mechanical (E&M) works under corridor - C2, Bhesan to Saroli, for Surat Metro Rail Project Phase-1, DC 2.

Rail Vikas Nigam (RVNL) was incorporated as Public Sector Undertaking (PSU) on January 24, 2003, with the vision of the then Prime Minister, Late Atal Bihari Vajpayee, to bridge the infrastructure deficit on Indian Railways. The company was granted Miniratna status in September 2013 and has also been recommended for Navaratna status by MoR. The company made its stock market debut in April 2019 after disinvestment of 12.16% stake of the government of India through initial public offering (IPO). It works on a turnkey basis and undertakes the full cycle of project development from conceptualisation to commissioning including stages of design, preparation of estimates, calling and award of contracts, project and contract management, etc.

For the second quarter ended September 30, 2022,RVNL’s consolidated net profit jumped 36.5% to ₹381.22 crore, while net sales grew 21.9% to ₹4,908.90 crore as compared to the same period last year.

Follow us on Facebook, Twitter, YouTube & Instagram to never miss an update from Fortune India. To buy a copy, visit Amazon.