Rail Vikas Nigam Limited (RVNL) Q4 2026 Earnings Call Transcript

Good afternoon, ladies and gentlemen. I'm Kartikeyan, moderator for the conference call. I would like to welcome you all to the earnings conference call of Rael Vikas Nigam Ltd for Q4 FY2026. We have with us today the management team of RVNL. Shri Salim Ahmed, Chairman and Managing Director. Shri Madhi Anupam Man, Director, Personal. As a reminder, all participants will be in Listen Only mode, and there will be an opportunity for you to ask questions after the presentation concludes. To do assistance during the conference call, please signal an operator by pressing star, then zero on a touchstone telephone. Please note that this conference is being recorded. We will start with a brief opening remark from CMDSR, which will be followed by a question and answer session. Thank you, and over to ESO.

Thank you.

Good afternoon, everyone. Thank you for joining us today for earnings call of RVNL for this quarter and year ending 31st March 2026. As all of you know, Arvina's portfolio comprises primarily of infrastructure-focused businesses, which spans across rail infrastructure. METROs, roads and highways, transmission, and Fort Harbor. Although this year has been challenging for the company, our VNL has remained focused on sustaining its operational performance and ensuring timely execution of key projects. Despite market and sectoral advent, we continue to maintain a strong order book. and are actively working towards improving efficiency and expanding business opportunities. With continued government emphasis on railway and per-structure development, we remain confident about the long-term growth prospects of the company. As a result of which, the company has achieved an MOU rating of very good for the year 2024-25 from Department of Public Enterprises. I am pleased to share that our order book continues to remain strong and diversified, providing healthy multi-year execution visibility for the company. During the quarter ended January to March 2026, the stand-alone order inflow stood at 4,644 crores, while for the full financial year 2025-26, Stand-alone order inflows were 5,875 crores. With joint ventures, we have also secured works amounting to rupees 1,201 crores. So as on March 31, 2026, the company's total order book stood at an impressive 99,262 crores. The order book is primarily driven by railways with 57,000 crores, followed by signaling at 14,900 crores, port, roads, and highways at 10,400 crores, and metros at 9,900 crores, and we have works of power and transmission of about 4,000 crores, and hydro and irrigation project. The company reported a strong growth in revenue during Q4, financial year 2025-26, with standalone turnover increasing by 47.6% quarter to quarter, if I compare it to Q3, financial year 26 to Q4 of financial year 26. There is a growth of 4.78% when compared to quarter 4 of 25 to quarter 4 of 26, and 0.72% year-to-year growth, reflecting healthy execution momentum and improved project activity during the quarter. On a consolidated basis as well, turnover grew by 42.94%, quarter 3 to quarter 4. 4.8% quarter 4 to quarter 4, 25, 26, and 2.45% year to year, demonstrating sustained business expansion and strong order execution capabilities. However, despite the robust increase in revenue, profitability remained under pressure during the quarter. Stand-alone EBITDA declined by 16.88%. If I compare quarter 3 to quarter 4, 33.55%, quarter 4 to quarter 5, 25 to 26, and 26.74% year-to-year, while Ibereta margin reduced from 10.36% in quarter 3 to 5.83% in quarter 4, tarantula 26. Similarly, PAT declined by 19.66 quarter-to-quarter. And 43.14% quarter 4 to quarter 5 compared to 25-26, and 32% year-to-year, indicating margin pressure and increased cost burden during execution. On a consolidated basis, the data and fact witness declines despite higher turnover. The decline in the above parameter is mainly driven by a few on-risk contracts and reconciliation adjustment relating to joint ventures. Overall, the results indicate strong revenue visibility and execution growth for the company. However, pressure on margins and profitability remains a key area of concern, which may require close monitoring in the coming quarters. I want to believe that building works of this R&M company have contributed 31.40% to the total revenue from operation, showing an increase of 129.50% from the previous year. I want to inform that the company has paid an interim dividend of 208 crores, and the board has also amended a final dividend of other than 48.03 crores, subject to approval of shareholders. I want to highlight the progress of the major quotas undertaken by Railvitas Nikam Limited. One is BharatNet project, which has been awarded by Bharat Sancha Nikam Limited. This is a 13,236 crore initiative to provide high-speed brown bed connectivity in rural and remote areas through 8,206 km of OFC infrastructure. Till date, RVNL has achieved 15.01 physical progress. Project execution momentum has improved significantly. And work is now progressing at a good pace across project locations, and we are expecting good revenue and profit margin in this year. Another important project is Rishikesh Kanparyag Rail Project, which is of a national importance in Uttarakhand. Being developed at a cost of 37,000 crore, the 125 km project has achieved 74% overlaugged progress, with around 96% tunnel excavation complete. Target for completion by December 2029, the project will improve access to the Marlin region. Another important project is Vandibhara's sleeper train set, a 14,400 crore project with 35 years maintenance arrangement being executed by our SPV Kinnatt railway solution. We are hopeful that first prototype train set is targeted for launch in December 2026. SPV has also received the Bronze Air Design Award 2026 in Italy for excellence in mobility and transportation design. Performance of our JVs and subsidiaries remained encouraging, contributing 399.86 crore to consolidated revenue and 64.23 crore to PAT. Additional dividend income received from JVs and subsidiaries scored at Rs. 43.45 crore during quarter four and 47.88 crore for the full year. I want to brief that the employee productivity showed improvement, which has increased from 21.23 crore to 22.46 crore. This growth reflects enhanced operational efficiency and better utilization of human resources. RVNL continues to demonstrate disciplined execution and stable operational performance, supported by a strong and diversified order book. We remain focused on efficient project delivery, margin discipline, and conversion of healthy L1 and L0 in pipeline. We are also actively encouraging opportunities in diversified infrastructure and emerging business areas. With sustained progress in key national infrastructure projects, the company is well-positioned for long-term sustainable growth and value creation. Thank you for your continued trust and support. So we are open for the question and answer. Thank you.

Thank you very much, sir. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press star and 1 on a telephone keypad and wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing star and 1 again. In the interest of time and fairness to all participants, participants are requested to restrict yourself to one question in the initial round and join back the queue for more questions.

I'll wait for a moment while the question gives us on this.

The first question comes from the line of Vishal Perival from PL Capital. Please go ahead.

Yes, sir. Thanks for the opportunity. Sir, on the margins, though you did clarify it is coming from one of the JV work that we are doing. So is it fair to say is the work has concluded and probably we'll have a better margin from quarter one of FI 27? Or do you think probably the base of four, four and a half percent EBITDA margin is a new base for us?

You know, pad looks lower in this quarter, but if we, you know, adjust for the, yeah, contract of 54 crores, and we have paid municipal taxes on new building, and we have, you know, adjusted after reconciliation of our SPV amounting to 35 crores, you will see that the And that is, like, slightly better than the last year, than the last quarter. So definitely now the book is, like, adjustment for the onerous contract has been done, and we are hoping that, and we are hopeful that we will definitely improve our margins in the first quarter of the 27th year. Thank you.

Okay. Yeah, thanks for the clarification. Maybe one last question from me is, I think we have seen an increase in the receivables in financial aid 26 numbers, and that has led to lower cash and lower other income. So, is it coming from which segment or probably anything, any color that can be provided?

You know, cash flow is a challenge because we are working for a ministry of railways, and, you know, we have to get money from a ministry of railways. You see that our 3,400 crores rupees were receivable from MOR, which we could not get within this year, but we have received now in April. So that was the reason for cash flow negative.

Sure, sir. I think this is helpful. I'll come back in the queue. Thank you, sir. Thank you. Ladies and gentlemen, if you have a question, please press star and one on a telephone keypad.

Ladies and gentlemen, if you have a question, please press star and 1 on a telephone keypad. Yeah, the next question from the line of Abhishek K. Lekha from Nestle Wealth LLP. Please go ahead.

Yeah, thanks for the opportunity. My question is on the receivable parts on the Krishna Patnam Railway Company, which is standing at 1116 crores, including 890 crores of interest. What is the timeline for resolution and how much we can realistically recover on that?

Good afternoon. The total receivable which is due from the Krishnapatnam stands at 1116 crore, which comprises of two components basically, the principal and the interest component. And during the last year gone by, Krishnapatnam has given a healthy return of around 290 crore out of there. This was due from them, and with the continued good performance of Krishnapatnam Rail Company, we hope that in the coming two years' time, mostly their savers will be wiped out, and the SP will also turn profitable, and due to their good performance, they have given a total dividend of 50 crores this year, out of which our winners received its share of 25 crores.

Okay, thank you. And what kind of top-line growth that can be expected in 26-27, and how should we take the margin outlook from current? Because what I understand from last con call was you mentioned that 26-27 as far as execution would be better off, and also margins would be comparatively on the brighter side.

Yes, we are definitely expecting a good rise in our revenue. Which will be around, say, 15 to 20 percent, and even the margins will definitely increase. That I want to assure you, and it will be much better than this year.

Should we expect it, like, from the current quarter itself, June quarter onwards, like the top-line growth and followed by the margin growth to be start seeing?

Yeah, definitely, quarter to quarter, year-wise, definitely there will be improvement, but, you know, the quarter, first quarter will be slightly challenging for us, but we are hopeful to, you know, achieve the targets and have a good revenue and good profit, good margins.

Okay, yeah, thank you so much.

That's it from my side.

Thank you. Next, we have a follow-up question from Vishal Perival from PL Capital. Please go ahead.

Yes, sir. Thanks for the follow-up. Sir, in terms of our order book of 99,000 crores, what is the breakup in nomination and competitive bidding now?

If you see, our break-up for nomination in bidding is almost 50 percent, 50-50 each. Presently, 45,000 works are of bidding, and 45 crores are on nomination basis. You know, our business strategy is that we should focus on railway. Work which we already have in pipeline, which is almost 30,000 works are going on. In addition, we are talking to other PSUs and government for management works on PMC cases, like we have got works from NMDC, Shaka-Fatnam Boat Trust, and other, and we are focusing that we should get more works on PMC, and third line will be, vertical will be, from the bidding works. But this time we are not bidding very aggressively for the bidding works. We have, you know, kind of position ourselves like that, that we should get at least 5 to 10 percent profit from each works of bidding. So that is our, you know, target and our strategy.

Sure, sir. And then in terms of our order inflow, though you did clarify standalone and this is Fi26 and Quarta4. For the JVs, can you also share what is the inflows in Quarta4 and Fi26?

JV, we have got one work recently from, you know, railways, which is a building work of 200 crores right now. And we are, you know, we are expecting that we should get more work in future, definitely.

Okay, okay. So, I think if I look at our order inflow, including JVs, everything is to the tune of maybe like 7,000-odd crore for this year. And we have done, I mean, execution of 20,000-odd crore in terms of revenue. And our order book has seen increase. So, is there a large part of the change is coming from the scope change or anything that you can share on this?

Actually, if you see the order book, which we reviewed during the last financial year was around 6,000 crore, and the execution from the bidding works also stand around 6,300 crores. So the order book inflows, and the execution matches, but in the coming years, the execution from the bidding works We'll increase tremendously because as you've seen in the last year, as compared to financial year 24, 25, in financial year 25, 26, it has increased by almost 129%, which was 2,737 crore in financial year 24, 25, which has increased to 6,283 crores in financial year 25, 26. So... Our order book is healthy, and we hope that with increased execution also, the order book will be able to give us the good, handsome revenue. And the change of the project is there, especially in macro projects and other projects, which we are including, even road projects, we got change of scope as per the requirement of the site and plans to call.

So, in terms of, I think, a lot of cost inflation that we are seeing in terms of commodity prices and other things, I understand nomination order, which is almost 45,000 odd crore, the things are passed through. But in competitive bidding, is it a fixed price contract or there are escalations? Oh, man. Can you share anything on that?

There are different IGO contracts. Some are fixed contracts, some are dynamic also. But in most of the contracts, we get the price variation, which controls the fluctuation of the market. But definitely challenges will be there.

Okay, okay, sir. And then in terms of one-day Bharat order, though you mentioned prototype is December 26th that we plan to supply, and the total order that is there of 120 sets, so by when this will get concluded? How are the delivery schedules after prototype is submitted?

Our prototype will be completed by this year only. So we'll give them two prototypes.

And after that, the total order, one day part of order book is to be completed in five years' time, and with a greater increase every year. The first year after prototype, we have to supply, because after supplying the prototype, it takes around three to four months' time for the various trials and other work. Thereafter, in the first year, five sets will be supplied. Thereafter, it will be increased and the total 120 sets will be supplied in five years' time.

Okay, okay. Sure, sir. I think this is helpful. I'll come back in the queue, sir. Thank you.

Thank you. Next, we have a follow-up question from Abhishek K. Rekha from Nestle Wealth LLP. Please go ahead.

Yes, sir. Thank you for the follow-up question. I just want to have the understanding on what steps the company is taking so that fast-track execution can be cleared on priority in terms of, like, automation or steps that are being taken, which helps the company to enhance the execution capability.

You know, the main challenge for us is faster execution, you know. Then only we can have good revenue and good margins. So our whole team is focusing on it. We are using the latest technologies, like we are using a BIM model, which gives us 5D, you know, functions, which gives the progress, financial progress, and planned progress versus the actual progress. We are using drones for the site, you know, inspection, and we are using many kind of software with dashboards and give us performance on our dashboard. So many things are being done at every level, from the supervisory to the top management, and our focus is for the faster execution of the work and timely execution of the work.

Can we have a presentation kind of wherein will you give the points or the areas which the company is doing a lot of exciting work and good work so that we also understand what exactly the company is doing in terms of execution readiness and how… Well that can be put in use, or has been, or you might be using it, so that it gets communicated well among the stakeholders.

Thank you. This is a very good suggestion, and we will definitely implement it and put it on our website. So that every stakeholder can go through it, and if they have some position, we will be happy to incorporate those.

Thank you. Thank you for that. And if that can be like in a presentation, like quarterly or yearly kind of a thing, that would be great also. Because a lot of questions can be put on basis of that. And one more thing, has Arvinil been approved to develop or upgrade corridors specifically for the defense logistics? Because in this war scenario, railways can also be used as a defense logistics. So anything specifically that can be done by Arvinil in that line?

Yeah, definitely we are doing, but we will not be able to explain here. There will be many strategic visits in pipeline.

Okay. Fine. Thank you so much.

Thank you. Ladies and gentlemen, if you have a question,

please press star and one on a telephone keypad. Ladies and gentlemen, if you have a question, please press star and 1 on a telephone keypad. Wait for a moment while the question queue assembles. Ladies and gentlemen, if you have a question, please press star and one on a telephone keypad. Ladies and gentlemen, if you have a question, please press star and 1 on a telephone keypad. Ladies and gentlemen, if you have a question, please press star and 1 on your telephone keypad.

Ladies and gentlemen, welcome to the call. We don't have any further questions, sir.

Okay. Can you close now? We can close the call now.

Okay, sir. I will conclude the call, sir.

Thank you very much.

Thank you, sir. Ladies and gentlemen, this concludes your conference for today. Thank you for your participation and for using Goose Abbas conference call service. You may disconnect your lines now. Thank you and have a pleasant day.