RailTel Corporation shares zoomed 10% today; what's next for this PSU stock?

Shares of RailTel Corporation of India Ltd on Friday surged 12.80 per cent to hit an intraday high of Rs 490. The stock eventually settled 9.62 per cent higher at Rs 476.20. At this price, the multibagger scrip has zoomed 268.86 per cent in the past one year.

The rail PSU has recently secured an order win worth Rs 20.22 crore from South Central Railway for telecommunication work. "This is to inform that RailTel Corporation has received the work order from South Central Railway for telecommunication works for provision of IP-MPLS in 523RKM of Secunderabad division of South Central Railway amounting to Rs 20,22,05,78," it has stated in a BSE filing.

The order is required to be executed by June 18, 2025, RailTel added.

RailTel's stock saw heavy trading volume on BSE today as around 18.46 lakh shares changed hands. The figure was way more than the two-week average volume of 4.10 lakh shares. Turnover on the counter came at Rs 87.50 crore, commanding a market capitalisation (m-cap) of Rs 15,283.09 crore.

A few technical analysts largely suggested that the counter could face resistance around Rs 490 levels. A decisive close above the said resistance zone can dictate next leg of the rally. Immediate support may be seen at Rs 465.

Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking, said, "The stock has seen resistance near Rs 490 level and decisive closing is required for more upmove. Major Support will be placed at Rs 425."

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "Support will be at Rs 465 and resistance at Rs 492. A decisive close above Rs 492 level may trigger a further upside towards Rs 530. The expected trading range will be between Rs 435 and Rs 545 for a month."

RailTel's counter traded higher than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-day and 200-day simple moving averages (SMAs). The stock's 14-day relative strength index (RSI) came at 67.87. A level below 30 is defined as oversold while a value above 70 is considered overbought.

The company's stock has a price-to-equity (P/E) ratio of 56.84 against a price-to-book (P/B) value of 7.63. Earnings per share (EPS) stood at 7.64 with a return on equity of 13.42.

RailTel Corp, a Mini Ratna (Category-1) PSU, is an information and communications technology (ICT) provider and one of the largest neutral telecom infrastructure providers in the country with a pan-India optic fibre network. As of March 2024, the government held a 72.84 per cent stake in the firm.