RITES stock rises after securing ₹454-crore turnkey contract in Karnataka

Shares of RITES Ltd. saw an uptick on October 23, 2024, following the announcement that the company's previous project management consultancy (PMC) contract with the Karnataka Mining Environment Restoration Corporation (KMERC) had been upgraded into a lucrative ₹454 crore turnkey project. This development has significantly boosted market sentiment, reflecting positively on the stock.

What does the contract involve?

The ₹453.99 crore project will see RITES constructing two private freight terminals (PFTs) in Dharmapura and Susheel Nagar, located in Ballari District. These terminals are part of the Comprehensive Environment Plan for Mining Impact Zone (CEPMIZ) under KMERC. With RITES now responsible for the project's entire execution — from design to completion — under the turnkey contract model, the company's position in the infrastructure and engineering space has been further strengthened.

Share market investment opportunity

Investors looking for promising share market investment opportunities are taking note of RITES. The stock has outperformed the Nifty index this year, climbing nearly 17% in comparison to NNifty's12% gain. This recent contract conversion adds further value, reflecting the ccompany'srobust project pipeline and increasing investor confidence in its growth trajectory.

RITES shares were trading at ₹294.80 on the National Stock Exchange at 12:03 pm on October 23, gaining 1% after the announcement. Over the past year, the stock has gained 26%, showing potential for long-term share market investment gains, especially as the company continues to secure new contracts and strengthen its portfolio.

RITES has also been active in other markets, with recent orders including a ₹35.87 crore locomotive project in Africa and a ₹60.03 crore consultancy contract in Uttar Pradesh. These deals underscore the ccompany'sexpanding footprint and further bolster its appeal in share market investment circles.

Key takeaways

• RITES secured a ₹454 crore turnkey contract, boosting investor sentiment and the stock price.
• The project involves constructing two railway PFTs in Karnataka under KMERC, expected to be completed in 30 months.
• RITES shares have risen 17% year-to-date, making it an attractive option for share market investment.