Rail Vikas Nigam Limited Reports Financial Performance and Appoints New Internal Auditor Amid Regulatory Challenges

Rail Vikas Nigam Limited (RVNL), a key player in India's railway infrastructure development, has reported financial results for the quarter and half-year ended September 30, while facing regulatory challenges. The company has also announced a significant appointment to its internal audit function.

Financial Highlights

For the half-year ended September 30, RVNL reported:

Particulars	Amount (Rs. in crore)	YoY Growth
Total Income	9,470.32	5.54%
Net Profit After Tax	364.88	-28.47%
Earnings Per Share (Rs.)	1.75	-28.57%

The company's total income saw an increase of 5.54% compared to the same period last year. However, net profit after tax decreased by 28.47%.

Regulatory Non-Compliance Issues

RVNL has received fines from both the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) for non-compliance with SEBI regulations regarding board and committee composition for the quarter ended June 30. The violations pertain to Regulations 17(1)(a), 17(1)(b), 18(1)(b), and 19(1)(c) of SEBI Listing Obligations and Disclosure Requirements Regulations, 2015.

The company's Board has acknowledged that these non-compliance issues stem from vacancies in Independent Director positions, including the absence of one woman Independent Director. RVNL, being a government company, has emphasized that it has no direct role in the appointment of directors.

Actions Taken

RVNL has been addressing the situation by:

Following up with the Ministry of Railways through multiple reminder letters.
Requesting immediate action for the appointment of Independent Directors.
Seeking the appointment of a woman Independent Director to comply with gender diversity requirements.

New Internal Auditor Appointment

RVNL's Board of Directors has approved the appointment of M/s. Ravi Rajan & Co. LLP, Chartered Accountants, as the company's Internal Auditor. The appointment is for a period up to March 31, 2026, and was decided during a board meeting held on November 11, 2025.

Ravi Rajan & Co LLP brings considerable experience to this role:

Established in 1989, with 36 years of experience in the field
A team of 15 partners and 225 professionals
Offers a wide range of services, supported by lawyers, company secretaries, engineers, and insolvency professionals

This appointment is expected to strengthen RVNL's internal audit processes and contribute to improved financial oversight.

Future Outlook

While RVNL faces challenges in board composition compliance, its financial performance shows mixed results. The company's ability to resolve these regulatory issues and fill the vacant Independent Director positions will be crucial for maintaining investor confidence and ensuring smooth corporate governance.

The appointment of a reputable firm as Internal Auditor demonstrates RVNL's commitment to enhancing its financial management and compliance practices.

Investors and stakeholders will be watching RVNL's actions in the coming months, particularly its efforts to comply with SEBI regulations, strengthen its board structure, and leverage the expertise of its newly appointed Internal Auditor to improve overall governance and financial management.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+1.62%	+0.44%	-4.10%	-14.32%	-23.86%	+1,598.94%

Rail Vikas Nigam Limited (RVNL), a Navratna public sector enterprise, has reported a significant decline in its net profit for the quarter ended September 30, 2025. The company's financial results, released on November 11, 2025, reveal a 53% year-on-year decrease in net profit, alongside a substantial reduction in revenue.

Key Financial Highlights

Metric	Q2 2025-26	Q2 2024-25	Change
Net Profit	Rs 196.11 crores	Rs 302.81 crores	-53%
Revenue	Rs 958.50 crores	Rs 4,869.22 crores	-80.31%

For the first half of the financial year 2025-26, RVNL's net profit fell to Rs 520.31 crores from Rs 698.48 crores in the previous year.

Financial Position and Challenges

RVNL continues to face challenges with its receivables from Krishnapatnam Railway Company Limited (KRCL). As of September 30, 2025:

Total amount receivable from KRCL: Rs 1,190.73 crores
Includes cumulative interest charges due to delayed payments: Rs 889.95 crores

Board Meeting Outcomes

The Board of Directors, in their meeting on November 11, 2025, approved the following:

Unaudited financial results for Q2 and H1 of FY 2025-26
Appointment of M/s. Ravi Rajan & Co. LLP, Chartered Accountants, as the Internal Auditor until March 31, 2026

Regulatory Compliance Issues

RVNL faces non-compliance issues regarding the composition of its Board and committees
The National Stock Exchange of India Limited (NSE) and BSE Limited have imposed fines on the company for non-compliance with regulations related to board composition for the quarter ended June 30, 2025
The company states it is continuously following up with the Ministry of Railways to address the vacancy of Independent Directors on its Board

Market Implications

The significant drop in both revenue and profit may raise concerns among investors about RVNL's operational performance and future growth prospects. The ongoing issues with KRCL and regulatory non-compliances could also impact investor sentiment.

Stakeholders will likely closely watch the company's strategies to improve its financial performance and resolve outstanding issues in the coming quarters.