DMRC effect? RVNL share price hits lifetime high logging 9% intraday rise

Stock market today: Shares of Rail Vikas Nigam Limited (RVNL) have been on an uptrend after ushering in June 2024. In one month, RVNL share price has surged more than 25 percent whereas the PSU stock has risen over 145 percent in YTD time. However, RVNL shares still still possess some steam for upside movement. RVNL share price today opened upside at ₹424.95 apiece on NSE and touched an intraday high of ₹455 within a few minutes of the opening bell. While climbing to this intraday high, the PSU railway stock climbed to a new peak, logging an intraday rise of around 9 percent.

According to stock market experts, RVNL share prices are rising today as the PSU has signed an MoU with the Delhi Metro Rail Corporation (DMRC) Limited. The MoU envisages RVNL to participate in upcoming projects in India and abroad as a service provider. This is working as the short-term reason for the rise in the railway PSU stock. However, they said that the market is expecting a big-ticket announcement in the railway infrastructure sector in the upcoming Union Budget, and hence, the stock is already under the bulls' radar. They said that the RVNL share has crucial support at ₹430 while the PSU stock faces a hurdle from ₹475 to ₹480.

DMRC trigger

Pointing towards the immediate reason for the rise in RVNL share price, Avinash Gorakshkar, Head of Research at Profitmart Securities, said, “RVNL has declared signing an MoU with the Delhi Metro Rail Corporation Limited, a significant development that enables the PSU railway company to participate as a project service provider in metro, railways, high-speed railways, railway electrification, etc. This has been well-received on Dalal Street, and bulls are reacting positively to this RVNL-DMRC MoU.”

Gorakshkar said that RVNL shares are already under the bulls' lens as the market is expecting a significant boost in the railway infrastructure sector in the upcoming Union Budget 2024. This anticipation is based on the government's focus on infrastructure development and the potential for RVNL to secure major projects. So, the uptrend in RVNL share price is expected to continue, and any dip in the stock ahead of the Budget 2024 should be seen as a buying opportunity by long-term investors.

RVNL share price target

Expecting more upside in RVNL share price, Sumeet Bagadia, Executive Director at Choice Broking, said, “RVNL shares have crucial support placed at ₹430 apiece. On the upper side, the stock is facing hurdles at ₹475 to ₹480 per share mark. Those who have RVNL shares in their portfolio are advised to hold the scrip, maintaining a stop loss at ₹430.”

On the suggestion to fresh investors regarding RVNL share price, Bagadia said, "Fresh investors can adopt a 'buy-on-dips' strategy, which means buying the stock when its price dips, maintaining a strict stop loss at ₹430. This strategy is suitable for those who are willing to take on the short-term risk for the potential reward of the short-term target of ₹430."

RVNL news

In an exchange filing on Thursday, RVNL informed Indian stock market exchanges about the MoU with DMRC, saying, “In terms of Regulation 30 read with part B of Schedule III of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, RVNL has signed MoU with M/s Delhi Metro Rail Corporation Limited (DMRC) for participation in the upcoming projects in India and abroad as Project Service Provider for Metro/ Railways/High-Speed Rail/ Highways/ MegaBridges/ Tunnels/ Institutional Buildings/ Workshops or Depots/ S&T works/ Railway Electrification.”

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