Q2 2025 RITES Ltd Earnings Call Transcript
Key Points
- RITES Ltd (NSE:RITES) reported a significant increase in order inflows, securing over 90 orders totaling more than INR700 crores in the quarter, surpassing the entire first half of the previous fiscal year.
- The company is aggressively expanding its export order book, breaking a hiatus with new orders from Bangladesh and South Africa, totaling INR1,300 crores.
- RITES Ltd (NSE:RITES) is diversifying its quality assurance business, reducing dependency on Indian Railways and securing international clients, including its first order from Sri Lanka.
- The company is leveraging AI technology for quality assurance, aiming to improve inspection quality and capitalize on new market opportunities.
- RITES Ltd (NSE:RITES) has entered into strategic MOUs, including one with STR Rail for rail infrastructure projects across the Middle East, indicating potential for future growth in consultancy and export services.
- The company's EBITDA margins have fallen below 20%, with PAT margins around 15%, indicating pressure on profitability.
- RITES Ltd (NSE:RITES) faces margin stress due to an increase in competitive bidding, with fresh orders now over 70% competitive.
- The quality assurance business has been impacted by a 30% reduction in volume and a 20% decrease in rates due to increased competition.
- Export orders, while increasing, are expected to generate revenue only by the next fiscal year, delaying immediate financial benefits.
- The company's turnkey segment is experiencing low margins, with current projects yielding around 1% to 2% margins, below historical levels.
(audio in progress) We are consolidating, and our focus has to be and will be in the coming quarters to continue increasing the execution and the sequential trend in terms of revenue, about 11% to 12% from quarter one to quarter two. That is what we will consolidate upon in the coming quarters so that the effort is to be able to reach as close as possible on an FY basis, as close as possible to the previous FY.
In terms of the order inflows, we are quite aggressively moving forward in maintaining our track record of being a one order a day company. And this quarter itself, we got 90-plus orders totaling to about INR700 crores plus. And this in one quarter was, in fact, equal to the more, in fact, much more than even the entire H1 of previous FY. So you need to keep consolidating our order book and also, we will continue to focus on increased execution in the balanced quarters of this FY.
With these broad opening comments, I leave the floor open for questions.
| Access to All Earning Calls and Stock Analysis | |
| 30-Year Financial on one screen | |
| All-in-one Stock Screener with unlimited filters | |
| Customizable Stock Dashboard | |
| Real Time Insider Trading Transactions | |
| 8,000+ Institutional investors’ 13F holdings | |
| Powerful Excel Add-in and Google sheets Add-on | |
| All data downloadable | |
| Quick customer support | |
| And much more... |
Trustpilot
We'd love to learn more about your experiences on GuruFocus.com and how we can improve!
Take Survey
