Rites posts highest margin in 6 years in Q4FY25; stock jumps 11%

Business Standard

16-05-2025

Rites share price today: Shares of engineering and consultancy services company, Rites, surged over 11 per cent to hit an intraday high of ₹277.50 on Friday after the company reported better-than-expected March 2025 quarter (Q4 FY25) results.
At 1:50 PM on Friday, Rites stock was quoting at ₹276.69, up 11.5 per cent from the previous session's close of ₹248.26 on the National Stock Exchange (NSE). In comparison, the benchmark Nifty50 index was trading at 25,011.30 levels, down 50.80 points or 0.2 per cent. However, on a year-to-date (YTD) basis, the stock has fallen around 4 per cent. The company's total market capitalisation stood at ₹12,283.89 crore.
Rites Q4 FY25 results update
In the March 2025 quarter, Rites reported consolidated revenue from operations of ₹615 crore, down 4.3 per cent compared to ₹643 crore in the year-ago period. The revenue decline was due to lower revenue from quality assurance, a downturn in turnkey and almost no exports. Earnings from interest, tax, depreciation and amortisation (Ebitda) rose 6.2 per cent year-on-year to ₹189 crore. Its profit after tax (PAT) rose 3.4 per cent Y-o-Y to ₹141 crore.
In FY25, the company's operating revenue came in at ₹2,324 crore, down from ₹2,539 crore in the previous financial year. The company reported a PAT of ₹424 crore against ₹495 crore in the previous fiscal. The management expects a pick-up in exports and turnkey during FY26.
Brokerage views of Rites - Elara Capital
According to analysts at Elara Capital, Rites is witnessing a recovery as margins and profits have increased Y-o-Y after falling for 10 quarters. The company posted the highest margin in the past six years. "We lower our FY26E and FY27E EPS estimates by 15 per cent and 20 per cent, respectively, due to decelerating margin in Consultancy and a higher share of lower-margin turnkey segment in the order book," the brokerage said.
Elara Capital has maintained a 'Buy' rating on the stock with a higher target price of ₹335 from ₹325 earlier, on 28x (unchanged) March FY27E EPS. "The company has witnessed a record increase in order inflows during the year, along with expected rebound in exports from FY26, and the stock has underperformed the Nifty by 15% in the past six months," the brokerage added.
About Rites
Rites is a Navratna public sector enterprise. It is a leading player in the transport consultancy and engineering sector in India with diversified services and geographical reach. The company has experience spanning more than five decades. It has undertaken projects in over 55 countries in Asia, Africa, South America, and the Middle East region.