RITES Ltd. (RITES) AI Stock Analysis

• Market Cap: ₹109.77B
• Dividend Yield: 3.24%
• Average Volume (3M): 169.49K
• Price to Earnings (P/E): 26.7
• Beta (1Y): 2.09
• Revenue Growth: -5.23%
• EPS Growth: 3.21%
• Country: IN
• Employees: 1,809
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 3.50
• Shares Outstanding: 480,603,760
• 10 Day Avg. Volume: 47,035
• 30 Day Avg. Volume: 169,494
• PEG Ratio: -1.85
• Price to Book (P/B): 4.19
• Price to Sales (P/S): 4.99
• P/FCF Ratio: 21.93
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 64 Neutral
• Price Target: ₹233.00 ▼(-5.27% Downside)

RITES Ltd. scores 64, driven by its strong financial performance and stable balance sheet. However, technical indicators suggest potential short-term weakness, and the high P/E ratio indicates possible overvaluation. The dividend yield offers some compensation for investors.

Positive Factors

Strong balance sheet / low leverage

Low financial leverage and a strong equity ratio give RITES flexibility to pursue large, multi-year infrastructure contracts and bid competitively. A solid balance sheet reduces refinancing risk, supports working capital during long project cycles, and enables selective investments or shareholder distributions over time.

Robust operating cash generation

Operating cash flow materially exceeds net income, indicating genuine cash generation from fee-based services and inspection work. Durable cash conversion supports project mobilization, funds recurring lab and inspection investments, and lowers reliance on external financing during cyclical slowdowns.

Healthy profit margins

Consistently healthy gross and net margins reflect operational efficiency and pricing power across consultancy, inspection, and project management services. Margin resilience provides a buffer versus revenue swings, funds reinvestment in technical capabilities, and helps sustain returns during contract cycles.

Negative Factors

Revenue decline trend

A negative revenue growth trend reduces scale in a fee-driven consultancy model. Sustained top-line contraction can pressure utilization and pricing, diminish repeat contract volumes, increase per-unit fixed costs, and impair the firm's ability to retain specialized talent critical for long-duration infrastructure projects.

Variable free cash flow

Variability in free cash flow complicates funding for long-gestation contracts and working capital timing in project execution. Irregular FCF may force short-term borrowing during peak mobilization, constrain predictable capital allocation, and weaken resilience against prolonged project payment delays.

Dependence on government/public clients

High exposure to government and public-sector projects concentrates revenue risk on public spending cycles and procurement timelines. This reliance can lead to slower payments, budget-driven award fluctuations, and sensitivity to policy or funding changes that can materially affect contract flow over months to years.

RITES Ltd. Business Overview & Revenue Model

Company Description

RITES Limited, together with its subsidiaries, provides consultancy, engineering, and project management services in the field of railways, highways, airports, ports, ropeways, urban transport, inland waterways, and renewable energy. The company operates through four segments: Consultancy Services; Leasing of Railway Rolling Stock & Equipments; Export of Rolling Stock, Equipments and spares; and Turnkey Construction Projects. It is involved in the survey and feasibility studies, detailed design and engineering, project management consultancy, technical audit, third party inspection, quality assurance, construction supervision, and leasing and export of locomotives and rolling stock; and maintenance and operational facilities such as smart yards, coaching, and freight maintenance depots. The company also constructs railway workshops, track doubling /tripling/quadruplicating, new/additional railway line, railway electrification, redevelopment of railway stations, institutional buildings, wind, solar and other renewable energy projects on a turnkey basis; and civil construction works; and generates power from windmills and solar energy plants. In addition, it offers services in the field of road/railway tunnels engineering, urban engineering, electrical engineering, information technology, privatization and concession projects, railway electrification, rolling stock design, railway equipment, signaling & telecommunications, surveys, and training programs. The company serves central/state governments, public sector undertakings, large corporations, and private enterprises in India, Asia, and Africa. RITES Limited was incorporated in 1974 and is based in Gurugram, India.

How the Company Makes Money

RITES generates revenue through multiple streams, primarily from consultancy services, project management, and engineering services related to transport infrastructure. The company earns fees for conducting feasibility studies, detailed project reports, and project management consultancy on various infrastructure projects. Additionally, RITES generates income from the manufacturing and supply of railway rolling stock, including locomotives and coaches, as well as providing maintenance and repair services. Significant partnerships with government bodies, state-owned enterprises, and international organizations contribute to its earnings, allowing RITES to undertake large-scale projects both domestically and internationally. The company also benefits from a growing demand for infrastructure development in emerging economies, enhancing its revenue potential.

RITES Ltd. Financial Statement Overview

Summary

RITES Ltd. has a strong financial position with solid profitability and a robust balance sheet. The company maintains healthy profit margins and low financial leverage, although revenue fluctuations and cash flow variability require attention.

Income Statement

RITES Ltd. has shown a mixed performance in recent years. While the revenue has faced some fluctuation, the company maintains healthy gross and net profit margins, indicative of operational efficiency. However, the recent decline in total revenue could be a concern if it continues.

Balance Sheet

The company demonstrates a solid balance sheet with a low debt-to-equity ratio, indicating low financial leverage. The equity ratio is strong, suggesting good financial stability. The company's ability to manage its liabilities effectively is a positive indicator of its financial health.

Cash Flow

RITES Ltd.'s cash flow statement shows a robust operating cash flow relative to net income, indicating good cash generation capability. However, variability in free cash flow growth requires attention, suggesting potential challenges in cash management or capital expenditures.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	22.22B	22.18B	24.53B	26.28B	26.62B	19.05B
Gross Profit	6.95B	6.83B	8.23B	9.43B	8.96B	6.67B
EBITDA	5.18B	5.09B	6.38B	7.39B	7.19B	5.44B
Net Income	3.86B	3.85B	4.55B	5.42B	5.16B	4.32B
Balance Sheet
Total Assets	0.00	61.19B	56.61B	59.72B	58.22B	58.33B
Cash, Cash Equivalents and Short-Term Investments	9.60B	9.60B	31.38B	34.71B	33.74B	34.74B
Total Debt	0.00	90.30M	80.00M	54.20M	275.90M	365.50M
Total Liabilities	-27.49B	33.70B	29.41B	32.53B	32.28B	33.53B
Stockholders Equity	27.49B	26.40B	26.09B	26.04B	24.89B	23.92B
Cash Flow
Free Cash Flow	0.00	5.04B	2.94B	4.24B	1.68B	4.36B
Operating Cash Flow	0.00	6.37B	4.32B	5.60B	3.10B	5.16B
Investing Cash Flow	0.00	-2.19B	110.70M	-150.00M	529.60M	1.83B
Financing Cash Flow	0.00	-4.05B	-5.04B	-4.83B	-4.40B	-7.08B

RITES Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 245.95
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:RITES, the sentiment is Neutral. The current price of 245.95 is above the 20-day moving average (MA) of 228.69, above the 50-day MA of 232.11, and below the 200-day MA of 250.22, indicating a bearish trend. The MACD of -3.41 indicates Negative momentum. The RSI at 49.44 is Neutral, neither overbought nor oversold. The STOCH value of 74.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for IN:RITES.

RITES Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IRCON	65 Neutral	₹154.15B	25.66	―	1.56%	-13.85%	-34.81%
RITES	64 Neutral	₹109.77B	26.70	―	3.24%	-5.23%	3.21%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
BEML	63 Neutral	₹149.50B	50.53	―	0.29%	-1.31%	3.61%
KEC	60 Neutral	₹177.58B	26.08	―	0.74%	12.21%	56.50%
TITAGARH	60 Neutral	₹110.58B	56.66	―	0.12%	-14.65%	-36.95%

RITES Ltd. Corporate Events

RITES Ltd. Announces Senior Management Change

RITES Ltd. announced a change in its senior management with the cessation of Shri Shiv Ratan as Chief Vigilance Officer following the completion of his deputation tenure. The company acknowledged a delay in notifying the exchanges about this change and has taken steps to improve its internal processes to prevent future delays.