RailTel Shares Surge 10% Following ₹25 Crore Work Order from HPCL

Shares of RailTel Corporation of India soared nearly 10% to hit an intraday high of ₹339.50 on March 24, 2025, following the announcement of a ₹25.15 crore work order from Hindustan Petroleum Corporation Limited (HPCL). This five-year contract, which involves providing MPLS (Multi-Protocol Label Switching) and ILL (Internet Leased Line) services, has boosted investor sentiment and driven the stock upward.

Details of the HPCL Contract

The ₹25.15 crore order (excluding taxes) is a rate contract for renewing existing MPLS/ILL links and adding new connections over time, subject to feasibility. The project will run from April 1, 2025, to March 31, 2030, providing RailTel with a steady revenue stream over the next five years. This comes as RailTel continues to expand its portfolio of services and secure contracts from major organizations.

Recent Performance of RailTel Shares

Despite today’s rally, RailTel shares have struggled over the past six months, witnessing a decline of 27.39%. Year-to-date (YTD), the stock has fallen by 16.80%, and over the past three months, it dropped by 15.26%. However, in the last month alone, the stock has rebounded by 9.22%, reflecting renewed optimism among investors.

At its peak, RailTel’s stock had soared over six times its IPO price of ₹94 but later plunged to ₹265 on March 3, marking a steep 57% drop from its record high. Despite these fluctuations, the HPCL contract signals growth opportunities for the railway PSU.

Technical Indicators

RailTel shares are currently trading above their short- and medium-term exponential moving averages (10-day and 20-day EMAs), indicating near-term bullish momentum. However, they remain below their long-term EMAs (100-day and 200-day), suggesting room for further recovery. The Relative Strength Index (RSI) oscillates near the 52 mark, signaling neutral momentum as per Trendlyne data.

Financial Performance

In Q3FY25, RailTel reported a 5% year-on-year rise in net profit, reaching ₹65 crore. Revenue grew by 15% YoY to ₹768 crore; however, EBITDA declined by 6.6% YoY to ₹121 crore due to margin contraction from 19.4% in Q3FY24 to 15.8% in Q3FY25.

Conclusion

The HPCL contract is a positive development for RailTel as it strengthens its position in the telecom infrastructure space while providing long-term revenue visibility. While analyst coverage remains sparse, this order could pave the way for further growth opportunities for the company in both public and private sectors.

Disclaimer: This news is solely for educational purposes. The securities/investments quoted here are not recommendatory.

To read the RA disclaimer, please click here