Not IRFC, But A Zero-Debt Railway PSU Stock To Announce 2nd Interim Dividend On Nov 6, Record Date Fixed; BUY

 Navratna PSU company under the Railway Ministry, is coming up with a second interim dividend reward for FY25. The announcement for this is likely to take place in November month. This will also be the first dividend since its bonus issuance in the ratio of 1:1. Who is it? Not the largest railway companies like IRFC or RVNL, but instead midcap with Navratna status, RITES Ltd.


The stock dipped by 1.85% on BSE, to end at Rs 302.80 apiece after market hours of October 18. The company's m-cap is currently at Rs 14,552.68 crore.

The stock's 52-week high and low is at Rs 413.08 apiece and Rs 216.33 apiece respectively. While its price-to-equity ratio is at 34.40x, and return on equity at 16.88%. YTD, RITES stock has surged by nearly 21% on BSE.

As per the regulatory filing, RITES announced that a meeting of the Board of Directors of the Company is scheduled to be held on Wednesday, 6th November 2024 inter- alia to consider, approve and take on record Standalone and Consolidated Unaudited Financial Results of the Company for the quarter and half year ended on 30th September, 2024.

Also, the meeting may consider payment of the Second Interim Dividend, for the FY 2024-25, if any.

For this, RITES said that it fixed Friday, 15th November, 2024 as the Record date for payment of the second Interim Dividend for the FY 2024-25, if declared by the Board.

In 2024 so far, the company delivered up to Rs 12.25 dividend per share to its investors. The latest dividend payout was of Rs 5 per share for which RITES turned ex-dividend in September this year. In FY24, the company delivered dividends of 180% worth Rs 18 per share.

Currently, RITES has a dividend yield of 5.94%.

However, it needs to be noted that RITES' upcoming dividend is after its bonus issue in the ratio of 1:1, for which the company also turned ex-date on September 20.

RITES Limited, a Navratna and Schedule 'A' Central Public Sector Enterprise under the Ministry of Railways, incorporated on April 26, 1974, is a multidisciplinary engineering and consultancy organization, providing a comprehensive range of services from concept to commissioning in all facets of transport infrastructure and related technologies.

Should you buy RITES share price?
As per Trendlyne data, the consensus recommendation from 4 analysts for Rites Ltd. is HOLD. Of the total, only 1 analyst has recommended Strong BUY on RITES, while two suggest HOLD the stock. EPS is expected to grow by 1.8% in FY25. The average 1-year target price is at Rs 459.25 apiece, hinting at a potential 52% upside 

RITES is a leading player in the transport consultancy and engineering sector in India, providing a diverse range of services under one roof. RITES is uniquely placed in terms of diversification of services and geographical reach in various sectors such as railways, highways, metros, tunnels, bridges, urban engineering, sustainability & green mobility, airports, ports, ropeways, institutional buildings, inland waterways, etc.

Also, broker Antique Stock Broking has suggested HOLD on RITES shares for a target price of Rs 354.


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