With export markets picking up, RITES will look to enhance its international play as it bids for rolling stock orders in Lat-Am, South East Asia and African nations. 

The company is ‘bidding or pursuing leads for five to 10 projects’ in nations like Bangladesh, Chile, Argentina, Brazil and others.

The company recently won an order for 10 locomotives (engines) from Mozambique, amounting to ₹300 crore; while it was declared the L1 bidder for 200-odd coaches in Bangladesh for a project worth of ₹850-900 crore. Both were global tenders. 

According to Rahul Mithal, Chairman and Managing Director at RITES, benefits of export orders are expected to accrue in the latter half of FY25 and onwards. 

“Locomotive orders take 12-15 months to materialise for delivery, whereas coach orders materialise in 6-9 months. So it’s only in the latter half of FY25 that you will see the export orders having a positive impact on our topline and profits. We have also placed bids or pushing leads across various markets….more than five, reaching to a double digit,” he told businessline

Vande Bharat exports

Mithal said, there is also a strong push towards the export of Vande Bharat trains and countries like Chile, Argentina and Brazil have expressed interest. Queries have been generated and follow-up is taking place. 

“An option to customise offerings around voltage specifications and control panel work is being discussed with the South American nations. There is an interest around the Vande Bharat trains globally. So we are exploring these leads,” he added. 

Necessary tie-ups with coach and wagon manufacturers in India is also to be explored as the company looks to place bids. 

RITES reported an operating standalone revenue of ₹653 crore in Q3FY24, almost flat on a Y-o-Y basis with consultancy & turnkey verticals making up for the fall in export revenue. 

EBITDA moderated to ₹144 crore for the quarter due to change in segmental mix, primarily slowdown in exports. 

Exports revenue stands at ₹58 crore. 

For RITES, the consultancy vertical continues to provide the highest revenue, at ₹302 crore, with margins at 40.4 per cent. The segment grew close to six per cent, Y-o-Y. The leasing segment saw a quarterly revenue of ₹37 crore while turnkey revenue was ₹256 crore. 

“So we did focus more in consultancy specially to make up for the slowdown in export and inspection businesses. A ₹33-crore hit of these two segments on the profits was made up through the increased push in consultancy business,” Mithal said.