RailTel shares surge 4% on LoI from Maharashtra govt

Shares of RailTel Corporation of India rose over 4% on Thursday after the firm received a Letter of Intent (LoI) from Motor Vehicles Department, Maharashtra. Shares of the railway firm climbed 4.39% to Rs 461.75 today against the previous close of Rs 442.30. Market cap of the firm stood at Rs 14,585 crore.  

A letter of intent (LOI) is a written, nonbinding document that outlines an agreement in principle between two or more parties before a legal agreement is finalized. 

The LoI relates to design, implement, operate and maintain Intelligent Traffic Management System (ITMS) on various blackspots/ vulnerable spots in the Vidarbha Circle for a period of 10 years.

"The estimated size of order as per RFP is Rs 274.40 Cr. The exact value will be known once PO is issued," said Railtel. 

The multibagger stock has gained 28 per cent in a year and gained 287 per cent in two years. The stock slipped to a 52-week low of Rs 265.30 on March 3, 2025 and rose to a record high of Rs 618 on July 12, 2024. 

The stock has a one-year beta of 1.6, indicating high volatility during the period.

In terms of technicals, the relative strength index (RSI) of RailTel stands at 78.4, signaling the stock is overbought on charts.

The Navratna PSU reported a 46.4% year-on-year (YoY) rise in net profit to Rs 113.4 crore in Q4 compared to Rs 77.53 crore reported in the same quarter of the previous fiscal year.  Operating income jumped to Rs 1,308.28 crore, rising 57% YoY compared to Rs 832.7 crore reported in the same year of the last fiscal year. 

On the operating front, the earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) climbed 53.8% to Rs 180 crore during the quarter. However, despite the growth, the EBITDA margins during the quarter contracted by 27 basis points to 14% in Q4FY25. The fall in EBITDA margins was due to an 86% increase in expenses that resulted from projects executed in the same quarter last year. 

RailTel Corporation is a Navratna PSU and is one of the largest neutral telecom infrastructure providers in the country owning a pan-India optic fiber network on exclusive right of way (ROW) along railway track. The company's segments include telecom services and project work services.