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CMP: ₹300
Target: ₹370
RITES is a multi-disciplinary consultancy organisation in the fields of transport, infrastructure and related businesses. It provides a comprehensive array of services under a single roof. In overseas projects, RITES actively pursues and develops cooperative links with local consultants firms, as means of maximum utilisation of local resources and as an effective instrument of sharing its expertise with the local firm.
RITES has a very healthy order book which is led by consultancy and turnkey segments, contributing to around 42 per cent and 40 per cent, respectively.
The company has recorded consistent growth in order book which is spread across about 1,000 projects, reflecting diversified nature of the order book. As on October 1, 2019, the company has a order book of ₹5,833 crore showing strong earnings visibility going forward.
The company has negligible borrowings and aims to maintain a similar level of debt in the next 3-5 years. The only component of debt which the company has on its books is restricted to the energy business. On standalone basis, the company is debt free.
Considering the company’s impressive performance over the years, strong order book, sound financials, decent execution capabilities and favourable industry traits, we believe that the company is well positioned for long-term growth.
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