Rs 3.75/Share Dividend: Miniratna Stock To Trade Ex-Dividend Soon, Dividend Yield At 4%

A mid-cap Miniratna company operating in the construction industry is RITES Ltd. In India, RITES is a major force in the engineering and transportation consulting sectors. The record of achievement of RITES dates back over 49 years and includes more than 55 nations throughout the countries like Asia, Africa, Latin America, South America, and the Middle East. The company has declared a final dividend of 37.50% for FY23 and the stock is going to trade ex-dividend on Monday.

Rites Dividend

"The Board of Directors have declared first interim dividend for the Financial Year 2023-24 at the rate of Rs. 3.75 per share (37.5% of paid up share capital) of the company. Further, as intimated earlier vide our letter no. RITES/SECY/NSE, dated 17.07.2023, the record date set for the purpose of payment of first interim dividend for Financial Year 2023-24 is August 07, 2023," said Rites in a stock exchange filing.

RITES has announced an equity dividend of 205.00% at a face value of Rs 10, or Rs 20.5 per share, for the financial year ended March 2023. This generates a dividend yield of 4.45% at the current share price of Rs 458.75. The company has a solid track record of dividend declarations during the past five years. According to Trendlyne's statistics, Rites Ltd. has issued 18 dividends since September 11, 2018.

Rites Financials

In Q1FY24, RITES' operating revenue dropped by 10% to Rs 544 crore from Rs 605 crore in Q1FY23 on a consolidated basis. Compared to Q1 FY23, when total revenue was 637 crore, it is now 563 crore in the quarter under review. while EBITDA and PAT were at Rs 161 crore and Rs 120 crore, respectively, with margins of 29.6% and 21.3%. Operating revenue on a standalone basis dropped from Rs 578 crore in Q1FY23 to Rs 504 crore in Q1FY24. EBITDA and PAT were at Rs 126 crore and Rs 96 crore, with margins of 25.1% and 18.4% reported during Q1FY24.

Mr. Rahul Mithal, Chairman and Managing Director, RITES Limited, said, "The Q1 results show movement in the right direction vis-a-vis our envisaged goal for this FY, of being able to reduce the impact of the changed business dynamics on the QA front and downtick of the Export Revenue y-o-y by consolidating our Project Consultancy business."

Mr. Mithal said, "Building up on this performance further in the coming quarters, we are confident of being able to tap the upcoming opportunities in the Project Consultancy stream and the Export business, in line with our vision for this financial year."
The company maintained a robust order book of Rs 5702 crore as of June 30th 2023 thanks to more than 70 orders (including extensions of works) valued more than Rs 300 crore.

Rites Share Price

On Friday, the shares of Rites opened on the BSE at Rs 462.00 apiece and while writing this copy the scrip was trading at Rs 455.50 with a downside gap of 0.84% over the previous close of Rs 459.35. The stock made a 52-week-high of Rs 509.80 on (26/07/2023) and a 52-week-low of Rs 255.60 on (05/08/2022). During Q1FY24, the company reported promoter shareholding of 72.20%, FIIs stake of 3.44%, DIIs stake of 15.25% and public stake of 9.11%.

Rites Share Price Target

"For the past few days, the stock has been trading in a narrow range. Seems the stock has taken a pause after the decent rally. Considerably we can say that there can be an accumulation phase as there is a lesser movement in a short time frame," said Deven Mehata Equity Research Analyst - Choice Broking.

"After the breakout of the soccer pattern, the stock is sustaining within its previous support zone. The RSI is gradually trending higher, indicating increasing buying interest. Additionally, the price is approaching the middle Bollinger Band as well. One can accumulate from current levels or in tranches for better for a longer period of time. SL must be kept as 425," further added Deven Mehata.

Disclaimer

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