RITES is looking at expanding its inspection business that has now moved out from the exclusive fold of the railways.
State-run railway engineering and consulting company RITES Ltd is set to resume high-value rolling stock exports to Bangladesh, Mozambique and South Africa next financial year as it looks to double the share of exports in its revenue with at least one overseas order each quarter, CMD Rahul Mithal said in an interview.
The overseas business of RITES would also see it expanding it’s footprint in consultancy opportunities in Latin America, Africa, South East Asia and West Asia while moving beyond neighbouring countries such as Sri Lanka for its inspection business that involves certifying product and processes of various infrastructure projects.
“After a four-year hiatus, we now seeing high-value exports of rolling stock returning to RITES. In each of the quarters stating from last quarter of previous fiscal year, we have been bagging one export order and we intend to main this run rate bagging one exporter order in each quarter going ahead,” Mithal said.
He said the company will start generating revenue from exports of rolling stock with supply of passenger coaches to Bangladesh starting from second half of next year while locos are getting delivered to Mozambique early next year.
“Subject to design approvals by railways operators in South Africa, diesel locos may also start getting delivered and generating revenue from next fiscal,” the chairman and managing director said.
Rites had bagged ₹900 crore order from Bangladesh for supply of 200 rail coaches of nine different designs, ₹300 crore order for supply of 10 diesel locomotives to Mozambique and two orders of ₹90 crore for supplying cape gauge in-service diesel locomotives, which still have 15-20 years of life left, to South Africa.
The South African order will test the use of these diesel locos on cape gauge networks., Accordingly RITES sees huge potential coming from it from other African countries and even Indonesia that has trains running on this gauge.
“Our export orders will start generating revenue from next fiscal and we hope that along with implementation of other orders, we will see at least a 20% growth in our tooling and double digit growth in our bottom line in FY26,” Mithal said.
RITES, which is the export arm of Indian Railways, saw operating revenue (consolidated), excluding other income, stand at ₹576 crore in Q3FY25 as against ₹683 crore in Q3FY24, a 15.7% dip. Total revenue in the quarter also fell to ₹614 crore as against ₹700 crore in Q3FY24. Accordingly, RITES also saw its revenue and net profit declining in the nine-month period ending 31 December.
“Securing more than 110 orders of more than ₹1,900 crore in just one quarter (Q3), which is nearly equal to the orders received in the entire FY24, underscores our strategy to aggressively march ahead, leveraging our multisectoral strength and maintaining our USP of being a ‘1 order a day’ company,” Mithal said.
RITES is also looking at expanding its inspection business that has now moved out from the exclusive fold of the railways. The company has already bagged one order on testing in Sri Lanka and is expecting more orders in this line of business from both domestic and overseas clients.
“We are now focusing our energy on improved execution of orders in hand. This should arrest the slide in top line and bottom line by the end if current fiscal and give us positive growth in the coming year,” Mithal said.