homebusiness NewsRITES eyes revenue growth recovery next year after six straight quarters of underperformance
RITES eyes revenue growth recovery next year after six straight quarters of underperformance
Rahul Mithal, CMD of RITES said that the recent collaboration with Abu Dhabi Ports Group will open up huge opportunities for the company in the UAE, the upcoming India-Middle East-Europe Economic (IMEA) Corridor, South East Asia, and Africa.
RITES, formerly known as Rail India Technical and Economic Service, aims to break its streak of weak revenue growth next year, after failing to meet market expectations for six consecutive quarters.
"In quarter three (Oct-Dec 2023), we could achieve our vision of being a one order a day company; we got 100-plus orders in quarter three, totaling to more than ₹600 crore. So as these orders mature into revenue in the coming FY, we would see a substantial growth in our EBITDA vis-a-vis our base line of 2022-23 and 2023-24 will be a year of consolidation," the company's Chairman and Managing Director, Rahul Mithal told CNBC-TV18.
RITES, which works under the Ministry of Railways in India and deals with exporting train equipment and spare parts for Indian Railways, was granted the "Navratna" status by the government in October 2023.
Mithal also talked about the recent collaboration with Abu Dhabi Ports Group for logistics infrastructure development. He sees it opening up huge opportunities for the company in the UAE, the upcoming India-Middle East-Europe Economic (IMEA) Corridor, South East Asia, and Africa.
Through this collaboration, RITES will make use of its rich expertise in transport infrastructure development and project management, with AD Ports Group's extensive portfolio of world-class ports, logistics solutions and vertically-integrated business clusters.
AD Ports Group is a leading facilitator of global trade and logistics infrastructure. It is the developer and regulator of ports and related infrastructure in Abu Dhabi, the United Arab Emirates.
“Each opportunity, depending on the size of the consultancy order, the size of the infrastructure which AD Ports would invest in and take our help in the consultancy, would pan out in the coming months and quarters,” Mithal said
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Sharing details about the IMEA Corridor, he mentioned its importance as a forthcoming logistic route. He emphasised RITES' role as a consultant, highlighting collaborations both in India and now in partnership with AD Ports in the Middle East. Together, they aim to design and provide consultancy for the development of this corridor spanning from India through the Middle East to Europe. This partnership will encompass various aspects such as ports, railway corridors, and digital infrastructure, aiming to develop the corridor seamlessly from ports in one region to Europe.
In its quarterly results released in February, RITES reported a 14% drop in net profit to ₹120.14 crore for the quarter ended December 2023 compared to ₹148 crore in the year-ago period. The company’s revenue from operations stood at ₹682.89 crore in Q3FY24, marginally up from ₹677.34 crore reported in the same period a year ago.
The market capitalisation of RITES is around ₹17,807.57 crore. Its shares have gained close to 110% in the past year.
For the entire interview, watch the accompanying video
(Edited by : Shweta Mungre)
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