RITES Q3 FY25 earnings call.
A source-linked concall view: reported numbers, management language, guidance, commitments and risks that should carry forward.
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Revenue
₹576 Cr
verified against source
Revenue YoY
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reported change
EBITDA
Pending
latest reported figure
Source
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Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
RITES reported a 15-16% YoY dip in both top line and bottom line for Q3 FY25, with sequential improvement across all parameters. The EBITDA and PAT margins expanded by ~100bps sequentially, indicating successful execution focus. The quarter broke records with order inflows of INR 1,900+ crore (110+ orders), bringing the total order book to an all-time high of INR 8,000 crore—equivalent to nearly the entire previous fiscal year's order intake. Management maintained its stance that current margins represent the "bottom of the barrel" and targets 20% revenue growth in FY26 driven by execution from this order book, particularly the INR 1,300 crore export order book (Mozambique, Bangladesh, South Africa). Export margins will be significantly lower at ~10% EBITDA versus the traditional 20%+ due to competitive bidding. Turnkey segment (45% of revenue) faces margin pressure, but consultancy revenue is expected to remain above 50% of the mix. Q4 execution remains the key lever to minimize FY25 decline—management targets sub-10% revenue dip and sub-20% PAT dip for the full year. A key risk is Bangladesh execution sliding by 6 months due to political developments, though management remains hopeful of revenue realization by latter part of FY26.
Colored figures show movement against the previous available record.
Guidance to track
- Management targets at least 20% top line growth in FY26 versus FY25, driven by execution from the INR 8,000 crore order book, particularly export orders from Bangladesh (INR 900 crore) and Mozambique, plus improved turnkey execution.
- For FY25, management aims for top line dip below 10% and PAT dip below 20%, with Q4 expected to be the best quarter sequentially. This is driven by INR 200 crore nine-month shortfall being partially offset by Q4 execution.
- Console EBITDA margins of ~20% and PAT margins of 15-16% are expected to be maintained on annual basis, despite quarterly variations due to revenue mix. Export EBITDA margins will be ~10% (versus historical 20%+), but blended with high-margin consultancy, overall targets are achievable.
- Management targets at least one export order per quarter, having maintained this for four consecutive quarters. Order sizes can range from INR 40-50 crore to INR 200-300+ crore, depending on opportunities in Africa, Southeast Asia, and Latin America.
Risks flagged
- Bangladesh order (INR 900 crore) delayed by ~6 months due to political developments. Revenue recognition pushed to latter part of FY26 from earlier expectations. Management acknowledged execution slid into next FY but remains hopeful given manufacturing capacity and prototype approvals in progress.
- Management explicitly stated export margins will be 'much, much lesser' than historical 20%+ due to competitive bidding on global tenders. The Bangladesh order was a global EIB-funded tender, marking first competitive export order in 4-5 decades.
- Analyst Vishal Periwal specifically asked about turnkey execution picking up. Management acknowledged older turnkey orders have completed and fresh orders will start generating revenue from Q4 onwards. Turnkey is not a construction business for RITES—revenue flows through balance sheet as consultancy-design orders.
- Management explained quality assurance revenue decline was due to timing of new orders kicking in from Q2-Q3 last FY. Sequentially, QA contribution to consultancy will increase due to larger order book and client base. However, nine-month hit of INR 50 crore was partially attributed to this segment.
Key quotes
- Q3 YOY has a dip of about 15%-16%, both in top line and the bottom line. If you see sequentially, there has been an uptake in all the parameters, whether it is the top line, whether it is the EBITDA, the PAT, and in fact, both the EBITDA margins and PAT margins also have been about 1% growth.
- We are aiming, as I said, for the coming FY, growth of at least about 20% on the top line vis-à-vis the FY 2024-25. Margins, we are aiming to aspire to maintain at the current levels of about 20-odd% on a console basis EBITDA margins and about 15%-16% PAT margins.
- The 20-odd% margins which have been traditionally there in the export stream, the margins will be much, much lesser. Each order would have a different margin. So on a blended basis, it would work out to lesser. But overall, by and large, it would be definitely much lesser than 20-odd%.
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