(BSE Code: 541556) (CMP: Rs.228.70) (FV: Rs.10)
Incorporated in 1984, Rites Ltd together with its subsidiaries provides consultancy services in the fields of transport, infrastructure and related technologies. It operates in four segments: Consultancy Services; Turnkey Construction Projects; Export of Rolling Stock, Equipment and Spares; and Leasing of Railway Rolling Stock and Equipment. It offers services as consultants, engineers and project managers in the areas of railways, highways, airports, ports, ropeways, urban transport and inland waterways. It is also involved in third party inspection, quality assurance, construction supervision and project management, operation and maintenance, leasing and export of rolling stock; and provision of railway workshops modernization services. In addition, it generates power from wind mills and solar energy plants; manufactures and rehabilitates wagons; and undertakes civil construction work. Further, it offers services in various sectors such as architecture and planning, bridges and tunnel engineering, environmental/urban engineering, electrical engineering, financial management, geo-technology, industrial engineering, information technology, marine engineering, materials system management, privatization and concession projects, railway electrification, rolling stock design, signal and telecommunication, surveys and training programs. It serves governments, public sector undertakings, corporations and industrial establishments, private enterprises and other organizations. Rites has an equity capital of Rs.200 crore supported by reserves of Rs.2006.16 crore. The promoters (Government of India) hold 87.4% of the equity capital, which leaves 12.6% stake with the investing public. For FY18, Rites reported PAT of Rs.348.34 crore on sales of Rs.1502.84 crore and an EPS of Rs.17.42. During Q1FY19, it reported 18% higher PAT of Rs.82.05 crore on sales of Rs.310.04 crore and an EPS of Rs.4.1. It paid 20% dividend for FY18.
The stock trades at a P/E of 13x and looks attractive at the current level based on its financial parameters. Investors can buy this stock with a stop loss of Rs.214. On the upper side, it could zoom to Rs.320-325 in the long-term.