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

• 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:

1. Unaudited financial results for Q2 and H1 of FY 2025-26
2. 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.

Rail Vikas Nigam Limited (RVNL) has reported mixed financial results for the second quarter. The company saw an increase in revenue but experienced a decline in net profit compared to the same period last year.

Key Financial Highlights

• Consolidated net profit for Q2 stood at ₹230.52 crore, down from ₹286.90 crore in Q2 of the previous year.
• Revenue from operations increased to ₹5,122.98 crore, up from ₹4,854.95 crore year-over-year.
• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) declined to ₹342.39 crore from ₹389.31 crore in the corresponding quarter last year.
• EBITDA margin compressed to 6.68% from 8.02% in the previous year's Q2.

Half-Year Performance

For the first half of the fiscal year:

• Consolidated net profit reached ₹364.88 crore, compared to ₹510.82 crore in H1 of the previous fiscal year.
• Revenue from operations grew to ₹9,031.75 crore, up from ₹8,928.75 crore in the same period last year.

Other Notable Points

• The company's order book remains strong, with ongoing projects in rail infrastructure development.
• RVNL continues to focus on its core business of developing railway infrastructure projects across India.

Corporate Governance Update

In a separate development, RVNL's Board of Directors addressed concerns raised by stock exchanges regarding non-compliance with certain regulations. The company stated it is actively following up with the Ministry of Railways to address the vacancy of Independent Directors, including a woman Independent Director, on its Board.

RVNL maintains that as a government company, it has limited control over the appointment of directors and is awaiting action from the Ministry of Railways to resolve this issue.

Investors and analysts will be watching closely to see how RVNL navigates the challenges of increasing revenue while managing profitability in the coming quarters.