Railtel shares surge 9% on Rs 210 crore Education Quality Enhancement order

On Monday, the Railtel share price rose by 9 percent touching a day’s high price of Rs 407.70 on NSE after the company exchange filing revealed that they received contract valued at Rs around 210 crores for the Implementation for Education Quality Enhancement in Bihar under PM SHRI received from the State Project Director - Bihar Education Project Council and it mentioned that the project is expected to be completed by September 11, 2026, which means Railtel will have a sustained revenue stream from this project. This order plays a strategic role in Railtel’s diversification beyond its core telecom business and underscores its rising prominence in government-driven education technology initiatives. The PM SHRI scheme, under which Railtel operates in this case, is a nationwide drive to transform over 14,500 schools into future-ready institutions. 

Financially, Railtel commenced FY26 with robust Q1 numbers. The company’s consolidated revenue surged 33.3 percent year-on-year to Rs 743.81 crore, against Rs 558.11 crore last year. Net profit increased 35.8 percent to Rs 66.1 crore, up from Rs 48.67 crore for the same period. EBITDA climbed 12 percent to Rs 115.81 crore, and although margins declined from 18.5 percent to 15.6 percent, the overall profitability remains strong. Total order bookings in Q1FY26 stood at Rs 721 crore, compared to Rs 218 crore for Q1FY25, while the cumulative order book now exceeds Rs 7,197 crore. The segment-wise break-up shows Rs 334.76 crore from telecom services and Rs 409.05 crore from project work, reflecting Railtel’s evolving business mix. Management recognizes margin challenges in the IT and project segments, where competitive bidding and typical margins of 4 to 5 percent require efficient execution and cost discipline. 

Railtel’s management, led by Chairman and MD Sanjai Kumar, expressed optimism in recent earnings call transcripts regarding order book conversion, execution capabilities, and international business prospects. Kumar highlighted the strong Q1 start and projected approximately 25 percent revenue growth for the full year, based on new orders and a rising base. The expansion into sectors such as education, ongoing execution of major railway safety projects (Kavach), and international outreach are expected to drive future growth, even as project margins remain a key focus area. Additionally, MD Sanjai Kumar noted the prolonged timelines for major railway safety and ICT projects, with some initiatives expected to see execution close to 2027–28, ensuring stability in the order book.

In the broader context, the Union Budget 2025–26 saw Indian Railways secure a gross budgetary support of Rs 2,65,000 crore, which remained unchanged from last year. Key allocations include around Rs 1,16,000 crore for railway safety projects and a provision for asset modernization, electrification, and improved infrastructure.