BEL, RVNL, RITES shares rise up to 6%; why PSU stocks are gaining today?

Shares of public sector undertaking (PSU) entities Bharat Electronics Ltd (BEL), Rail Vikas Nigam Ltd (RVNL) and RITES Ltd remained in focus today amid positive developments. All these three PSU stocks gained up to 6% in early trade, in an otherwise weak broader market, as sentiments were lifted after they bagged new orders.

Among these PSU entities, RITES was the top performer, rising as much as 5.6% to ₹224.80 in the first hour of trade so far. The market capitalisation (m-cap) climbed to ₹10,630 crore.

In a similar trend, BEL share price jumped 2.5% to hit a high of ₹279.65, while its m-cap rose to ₹2.03 lakh crore. RVNL shares surged 3.5% to ₹349.40 and its m-cap increased to ₹72,150 crore.

Meanwhile, the equity benchmarks Sensex and Nifty were trading lower by 0.3% each.

In the recent times, these three PSU stocks have seen sharp correction, losing nearly 50% of its market value from its peak last year. While RITES shares are down 56% from its 52-week high of ₹398.50 touched on July 8, 2024,
BEL shares lost 20% as compared to its 52-week high of ₹340.35 hit on July 10, 2024. The RVNL share price is down 48% from its 52-week high of ₹647 hit on July 15, 2024.

What fuelled rally in BEL, RVNL, RITES stocks?

Defence major BEL in an exchange filing last evening said that it secured an additional orders worth ₹577 crore since the last disclosure February 20. The Navratna PSU received major orders include airborne electronic warfare products, advanced composite communication system for submarine, doppler weather radar, train communication system, radar upgradation, spares, services etc. With these, the total accumulated orders received by BEL during the current financial year stand at ₹13,724 crore.

On the other hand, railway company RVNL bagged an order worth ₹156.35 crore from South Western Railway. The engineering, procurement and construction (EPC) contract is for designing, supplying, erection, testing, commissioning of 2X25 KV OHE & PSI system (TSSs & SPs & SSPs) including electrical general services, engineering & telecommunication works. The time line for the completion of the project is 18 months.

Meanwhile, RITES has received an order worth ₹27.96 crore from South Central Railway for carrying out final location survey for high speed elevated rail corridor between Hyderabad- Benguluru and Hyderabad-Chennai. The survey involves preparing DPR, final alignment design, traffic survey report, ROR calculations, detailed estimate and preparation of EPC documents using modern survey techniques e.g. Airborne or Terrestrial LIDAR from South Central Railway.

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