In 2022, Rail Vikas Nigam Ltd (RVNL) - a Navratna and construction arm of the Ministry of Railways – was appointed as project implementation agency for the UTF (Uthuru Thila Falhu-Island) Harbour project in the Maldives. The order for this strategic project was placed by the Union Ministry of External Affairs. The project, at a cost of ₹1,544.60 crore, was to be completed within 24 months.

Two years later, and when ties between Maldives and India continue to be strained, the project – amongst the first RVNL had bid – is providing margins of around 11 per cent.

RVNL is now looking to expand its footprint overseas in West Asia, Africa and in the neighbourhood. Ties are also being explored with Botswana Railways and the Namibia Trans Kalahariproject for expansion, senior officials told businessline.

Earnings and margins from bidding projects are reportedly more than projects won on a nomination basis.

“The first project in India, which we secured through bidding, was the Indore Metro project. And the first overseas project, the Maldives, which we had taken through the bidding process.... (margins) from the Maldives project was 11 per cent, while the Indore project was 10.66 per cent. And the turnover from these two projects was ₹986 crore, which is approximately 45 per cent of the ₹2,255 crore of turnover in the bidding projects. So there is a quantum jump in the turnover of the bidding projects,” the company management said during a recent earnings call.

According to senior officials, with a success rate of 20 per cent (bids placed to wins), the company has already submitted bids in the international market that include neighbouring countries such as Bangladesh, Nepal and Sri Lanka; West Asian ones such as the UAE, Oman, Uzbekistan and Saudi Arabia; and in the African country of Rwanda.

“So we are trying to increase our footprint. We have also submitted the expression of interest in Botswana Railways, then Namibia Trans Kalahari project team,” a top official said. International offices have been opened in South Africa, Oman, the UAE and Maldives.

The company would look to expand presence beyond Railway infra and similar projects.

Earlier this year (in January), it had entered into a JV with a South African company Jakson Green to explore and execute solar power project opportunities in India and abroad. “We have entered into the international market and it is not limited to the railway infrastructure. So, we are very keen for these kinds of projects (apart from Railway infra), where there is plenty of scope available worldwide.... with very good margin,” the company top brass had said during its earnings call.

Order book

In FY24, RVNL participated in 142 bids costing around ₹65,000 crore; and has guided to participate in 150 bids this fiscal costing over ₹75,000 crore. Order-book guidance is expected to be three-four times the turnover.

“If our turnover this year was ₹21,700 crore, and we are targeting ₹23,000 crore in FY25, then the order book all the time should be around ₹92,000-1,00,000 crore. For FY24, order book was ₹85,000 crore.

Bottom-line growth of 15 per cent is expected to continue for “another five years”.