Gurugram, May 14, 2025 – RITES Limited (NSE: RITES, BSE: 541556), a Navratna public sector enterprise and India’s leading transport infrastructure consultancy and engineering firm, announced its financial results for the fourth quarter (Q4FY25) and fiscal year ended March 31, 2025. Despite a year-on-year revenue decline, the company reported growth in profitability metrics and recommended a final dividend, signaling confidence in its operational resilience and future growth trajectory.
Key Highlights: Q4FY25 and FY25 Financial Performance
Q4FY25 Consolidated Financials
- Operating Revenue: ₹615 crore (down 4.3% YoY from ₹643 crore in Q4FY24).
- Total Revenue: ₹639 crore (vs. ₹668 crore in Q4FY24).
- EBITDA: ₹189 crore (up 6.2% YoY), with margins improving to 30.8%.
- PAT (Profit After Tax): ₹141 crore (up 3.4% YoY), with margins at 22.1%.
FY25 Consolidated Financials
- Total Revenue: ₹2,324 crore (down 8.4% YoY from ₹2,539 crore in FY24).
- EBITDA: ₹527 crore (down 18.9% YoY), with margins at 23.8%.
- PAT: ₹424 crore (down 14.3% YoY from ₹495 crore in FY24).
- Final Dividend: ₹2.65 per share, totaling ₹127 crore, with a payout ratio of 95.4%.
Standalone Performance
- Q4FY25 PAT: ₹134 crore (up 9.2% YoY).
- FY25 Consultancy Revenue: ₹1,133 crore (36.3% margins).
Revenue Decline: Causes and Mitigation Strategies
The dip in consolidated revenue for FY25 (-8.4% YoY) was primarily attributed to reduced contributions from three key segments:
- Exports: Plummeted to a mere ₹15 crore in FY25 due to geopolitical tensions and delayed international project clearances.
- Quality Assurance (QA): Revenue fell amid slower domestic infrastructure approvals.
- Turnkey Projects: Execution delays in government contracts impacted revenue realization.
However, RITES’ strategic focus on high-margin consultancy projects (36.3% margins) and leasing operations (₹150 crore revenue) helped stabilize profitability. The company expects a rebound in exports and turnkey projects in FY26, supported by a robust order book and global tenders in progress.
Profitability Metrics: A Silver Lining
Despite revenue challenges, RITES demonstrated operational efficiency:
- EBITDA Margin Expansion: Q4FY25 EBITDA margins rose to 30.8% (vs. 28.9% in Q4FY24) due to cost optimization and higher-margin consultancy projects.
- PAT Growth in Q4: A 3.4% YoY increase to ₹141 crore, driven by disciplined expense management.
Mr. Rahul Mithal, Chairman and Managing Director, emphasized, “Our concerted efforts in executing high-margin projects this quarter have cushioned the impact of revenue headwinds. We are aligned with our long-term strategy to prioritize profitability over volume.”
Dividend Announcement: Rewarding Shareholders
RITES’ board recommended a final dividend of ₹2.65 per share, translating to a payout ratio of 95.4% – one of the highest in the infrastructure sector. This move underscores the company’s commitment to shareholder returns despite lower annual profits. Over the past five years, RITES has maintained an average dividend payout ratio of 85%, reflecting its status as a reliable dividend stock.
Order Book: A Strong Foundation for FY26
RITES achieved its highest-ever order book of ₹8,877 crore as of March 31, 2025, fueled by 150+ orders worth ₹1,418 crore secured in Q4FY25. Key wins include:
- Consultancy contracts for metro rail projects in Maharashtra and Uttar Pradesh.
- Leasing agreements for railway rolling stock.
- International projects in Africa and the Middle East (details undisclosed).
Mr. Mithal highlighted, “With an average of ‘one order a day,’ we’ve built a solid platform for FY26. Our focus is on timely execution to convert this order book into revenue.”
Segmental Performance: Consultancy Dominates
Standalone Business Breakdown (FY25)
- Consultancy: ₹1,133 crore revenue (49% of total), margins at 36.3%.
- Turnkey Projects: ₹797 crore revenue (34% of total), impacted by execution delays.
- Leasing: ₹150 crore revenue (6% of total), margins at 35.1%.
- Exports: ₹15 crore revenue (1% of total), down 92% YoY.
The consultancy segment remains RITES’ cash cow, leveraging its five-decade expertise in engineering solutions. The leasing division, though smaller, continues to deliver stable returns through long-term contracts with Indian Railways.
Industry Context: Infrastructure Sector Dynamics
RITES operates in a sector buoyed by India’s $1.3 trillion National Infrastructure Pipeline (NIP). However, challenges persist:
- Global Slowdown: Affected export-oriented projects.
- Regulatory Hurdles: Delayed approvals for QA and turnkey projects.
- Competition: Rising private-sector players in consultancy.
Despite this, RITES’ government-backed status and diversified service portfolio provide a competitive edge. The company’s foray into sustainable projects (“Transforming to GREEN”) aligns with India’s net-zero goals, opening avenues in green infrastructure.
Outlook: Cautious Optimism for FY26
Management’s FY26 priorities include:
- Export Revival: Targeting contracts in Africa and Southeast Asia.
- Turnkey Project Acceleration: Collaborating with state governments to fast-track approvals.
- Margin Protection: Focusing on consultancy and leasing to offset volatility in other segments.
Analysts remain cautiously optimistic. Pranav Kapoor, Infrastructure Analyst at Motilal Oswal, noted, “RITES’ order book provides visibility, but execution risks and global headwinds warrant monitoring.”
About RITES Limited
A Navratna PSU under the Ministry of Railways, RITES has executed projects in 55+ countries since 1974. Its services span transport consultancy, engineering, and leasing, contributing to iconic projects like Delhi Metro and Dedicated Freight Corridors.
Investor Relations
For further details, contact:
- Mr. Animesh Lodiya (RITES): investors@rites.com | +91 9654176514
- Ms. Lipika Jain (TLG India): lipika.jain@msigroup.com | +91 7838506661
Visit RITES’ investor relations page: www.rites.com.
Final Word
RITES’ Q4FY25 results reflect a mixed bag of challenges and strategic wins. While revenue declines highlight sectoral pressures, improved margins, record orders, and aggressive dividend payouts position the company for a resilient FY26. Investors will watch closely for export recovery and order book execution as key catalysts.
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