Shares of Rail Vikas Nigam Limited have been on a remarkable upward trajectory since the beginning of June 2024. In just one month, the stock price has surged by more than 25%, and the PSU stock has risen over 145% in the year-to-date period. The bullish sentiment around RVNL shares shows no sign of slowing down, with analysts suggesting there is still room for further upside movement.
The stock opened at ₹424.95 apiece on the NSE today and quickly soared to an intraday high of ₹455 within minutes of the opening bell. This rapid climb marked a 9 percent rise and set a new peak for the PSU railway stock. The recently signed Memorandum of Understanding (MoU) between RVNL and the Delhi Metro Rail Corporation (DMRC) Limited is the immediate catalyst for this surge. This agreement allows RVNL to participate as a project service provider in upcoming metro and railway projects both in India and abroad.
According to stock market experts, this MoU with DMRC has been well-received on Dalal Street, with investors reacting positively to the news. Avinash Gorakshkar, Head of Research at Profitmart Securities, highlighted the significance of the MoU, stating that it positions RVNL to engage in various high-profile projects such as metro railways, high-speed railways, railway electrification, and more. This development has undoubtedly caught the attention of bullish investors, who are now closely monitoring the stock.
The MoU does not solely drive the excitement around RVNL shares with DMRC. Market participants are also anticipating a major announcement in the railway infrastructure sector in the upcoming Union Budget 2024. This expectation is based on the government’s ongoing focus on infrastructure development, which could potentially lead to RVNL securing significant new projects. As a result, RVNL shares have become a hot topic among investors, with many seeing this as an opportune time to capitalize on the stock’s potential growth.
Sumeet Bagadia, Executive Director at Choice Broking, emphasized the stock’s crucial support level at ₹430 and identified resistance between ₹475 and ₹480. He advised current shareholders to hold onto their RVNL shares, maintaining a stop loss at ₹430. For new investors, Bagadia recommended adopting a ‘buy-on-dips’ strategy, which involves purchasing the stock during price dips while keeping a strict stop loss at ₹430. This approach is suitable for those willing to take on short-term risk in exchange for potential short-term rewards.
The broader market expectations for the Union Budget 2024 further bolster the positive sentiment surrounding RVNL. Investors are optimistic that the government will continue to prioritize infrastructure development, creating more opportunities for companies like RVNL. This optimism is reflected in the stock’s strong performance and the bullish outlook from market experts.
RVNL shares have experienced a significant uptrend in recent weeks, driven by the MoU with DMRC and heightened expectations for the Union Budget 2024. The stock’s impressive performance has caught the attention of investors, who are now closely watching for any further developments. With strong support levels and a favorable market environment, RVNL appears well-positioned for continued growth. Investors are advised to keep an eye on this PSU railway stock, as it could offer substantial returns in the coming months.
