Inventory to purchase in short-term: RITES Ltd has been below stress on the bourses, with the PSU engineering and consultancy firm shedding 11% prior to now one yr, shedding 10% during the last six months, and falling 5% prior to now three months. Regardless of this subdued inventory efficiency, analysts consider the draw back might now be restricted and that the inventory is poised for a rebound.
Axis Securities has turned constructive on the counter, naming RITES as its ‘Decide of the Week’ on the again of a robust order e-book, bettering export momentum and expectations of a significant contribution from turnkey tasks beginning Q4FY26. The brokerage has really helpful a ‘Purchase’ ranking with a goal worth of ₹271, implying a possible 10% upside over a 6–9 month horizon.
RITES shares are at the moment buying and selling at ₹247.25 apiece. The PSU inventory is down almost 22% from its 52-week excessive of ₹316.15 recorded in June 2025, whereas its 52-week low stands at ₹192.30, hit in March 2025.
Axis Securities’ Decide of the Week
Purchase RITES | Goal Worth: ₹271 | Upside: 10% | Time Horizon: 6-9 months
Axis Securities highlighted a number of structural positives supporting RITES’ medium-term development outlook, with the brokerage stating that the corporate stays well-placed to learn from rising infrastructure spending. The brokerage famous, “RITES continues to reveal robust income visibility backed by a wholesome order e-book combine and bettering traction throughout key verticals.”
Robust Order Ebook: Axis identified that RITES reported a notable pickup in orders throughout Q2FY26, securing over 150 new orders price ₹851 crore, which pushed the full order e-book to ₹9,090 crore. This offers income visibility for the subsequent 2–2.5 years. Of specific significance, 34% of the order e-book is from the high-margin consultancy phase, which Axis believes underscores the corporate’s profitability profile. Backed by a sturdy tender pipeline and rising alternatives inside the infrastructure ecosystem, the brokerage stated RITES stays well-positioned to generate sustainable long-term development.
Export Vertical to Drive Income Progress: Axis additionally highlighted the robust efficiency of the corporate’s export enterprise. RITES has secured export orders price ₹1,541 crore, with export income contribution constantly bettering since Q2FY26. Given this momentum, Axis Securities expects RITES’ general income to register a 23% CAGR over FY25–FY27E, supported largely by export exercise and the execution of order e-book gadgets linked to abroad markets.
Turnkey Initiatives to Enhance Gross sales: Turnkey tasks kind a considerable 46% of the corporate’s complete order e-book. Whereas income from this phase has dipped not too long ago attributable to most tasks being at early phases of execution, Axis Securities expects these tasks to regularly transition to superior phases starting Q4FY26, driving a significant pick-up in income. The brokerage believes turnkey execution will develop into an necessary catalyst for RITES’ prime line within the coming quarters, particularly as orders transfer from design and planning to bodily implementation.
Outlook and Valuation
Axis Securities stays optimistic, citing the corporate’s robust fundamentals. RITES maintains a sturdy steadiness sheet, robust return ratios, and a constant dividend observe report. With beneficial development alternatives throughout consultancy, exports, and turnkey divisions, Axis expects the corporate to ship Income/EBITDA/PAT development of 23%/24%/21% CAGR over FY25–FY27E.
On valuations, the inventory at the moment trades at 21x FY27E EPS, a degree Axis believes leaves room for upside given bettering execution visibility and margin help from the consultancy portfolio.
RITES Q2 Outcomes
RITES reported a 34% year-on-year (YoY) enhance in its consolidated web revenue to ₹98 crore within the second quarter of the 2025-26 monetary yr (Q2 FY26). In the identical interval final yr, the corporate had posted a revenue of ₹73 crore. The PSU’s income from operations rose 1.48% YoY to ₹549 crore through the quarter, in comparison with ₹541 crore within the September quarter of FY25.
On the operational degree, earnings earlier than curiosity, tax, depreciation and amortisation (EBITDA) stood at ₹130 crore, marking a 22% YoY bounce from ₹106 crore within the year-ago interval. The corporate’s EBITDA margin expanded to 23.64% in Q2 FY26, up from 19.67% in Q2 FY25.
Together with the outcomes, RITES additionally declared a second interim dividend of ₹2 per share, representing 20% of the corporate’s paid-up share capital for FY26. The report date to find out eligible shareholders was set as Saturday, November 15, 2025.
Established in 1974, RITES is a Navratna Central Public Sector Enterprise below the Ministry of Railways. It’s a multidisciplinary engineering and consultancy organisation providing a variety of companies—from idea to commissioning—throughout varied transport infrastructure segments and associated applied sciences.
Disclaimer: The views and proposals made above are these of particular person analysts or broking corporations, and never of Mint. We advise buyers to test with licensed consultants earlier than making any funding choices.
