IRCON International Bags INR 750 Crores Order from RVNL

IRCON bags ₹750 crore contract from RVNL for 125 km Rishikesh-Karanprayag rail project in Uttarakhand. Read to get complete details about the project. 

by Damodharan N

Updated Jul 09, 2024

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IRCON International Bags INR 750 Crores Order from RVNL

IRCON International Limited, a renowned player in India's infrastructure sector, has secured a significant contract worth INR 750 crores from Rail Vikas Nigam Limited (RVNL). The contract pertains to the "Design, supply, installation, testing and commissioning of broad gauge ballastless track (BLT), supply of ballast and installation of track" for a new broad gauge line stretching 125 kilometers between Rishikesh and Karanprayag in Uttarakhand.

This project, awarded through a joint venture involving IRCON, Paras Railtech Private Limited, and PCM Strescon Overseas Ventures Limited, is structured with IRCON holding a majority stake of 60%.

The contract, categorized as an Item Rate Contract and set to be executed over 42 months, underscores IRCON's expertise in railway infrastructure development. The award highlights IRCON's competitive edge in securing projects through a transparent bidding process, as affirmed by the absence of related party transactions or interests from the promoter group.

This development signifies a strategic expansion for IRCON in bolstering railway connectivity in Uttarakhand, aiming to enhance transport infrastructure in the region. The project's scope, focusing on modernizing track infrastructure without including rail and sleeper supplies, aligns with IRCON's commitment to delivering high-quality, technologically advanced solutions in the railway sector.

Read the full Release Here  

IRcon International Limited

Ircon International Limited (IRCON) is a government company established by the Ministry of Railways under the Companies Act, 1956, on April 28, 1976. Originally named Indian Railway Construction Company Limited, IRCON is a leading turnkey construction company known for its quality, commitment, and performance.

It operates in various states in India and multiple countries, including Malaysia, Nepal, Bangladesh, Mozambique, Ethiopia, Afghanistan, the UK, Algeria, and Sri Lanka. IRCON specializes in infrastructure projects, with core competence areas including railway, highway, and EHV sub-station construction.

The company has completed over 300 projects in India and more than 100 projects globally, undertaking challenging projects in difficult terrains and participating in prestigious nation-building initiatives.

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Rail Vikas Nigam Limited 

Rail Vikas Nigam Limited (RVNL) was incorporated in 2003 as a public sector undertaking to improve India's railway infrastructure, based on the vision of former Prime Minister Atal Bihari Vajpayee.

RVNL's mandate includes undertaking project development, financing, and implementation of rail infrastructure projects, mobilizing resources, ensuring timely and cost-effective execution, encouraging public-private partnerships, and adopting sustainable and environment-friendly construction practices.

The company arranges financial resources, executes works, creates project-specific SPVs, and commercializes projects as needed. Upon project completion, the concerned Zonal Railway takes over operation and maintenance under a financial arrangement, while RVNL may receive access or user charges on a BOT basis. 

IRCON International Bags INR 750 Crores order from RVNL - FAQs

1. What is the total value of the contract awarded to IRCON?

The total value of the contract is ₹750.82 crore, including GST.

2. What is the scope of work under this contract?  

The scope includes design, supply, installation, testing, and commissioning of broad gauge ballastless track, supply of ballast, and installation of track (excluding rails and sleepers) for the 125 km new BG line between Rishikesh and Karanprayag in Uttarakhand.

3. How is the contract awarded to the IRCON-led joint venture?  

The contract has been awarded to a joint venture of IRCON, Paras Railtech Private Limited, and PCM Strescon Overseas Ventures in the ratio of 60:25:15, respectively.

4. Is this a domestic or international contract?  

This is a domestic contract awarded by the Indian government entity Rail Vikas Nigam Limited (RVNL).

5. What is the expected timeline for completion of the project?  

The project is expected to be completed within 42 months.

6. Does the contract involve any related party transactions?  

No, the contract has been awarded by RVNL to IRCON through a competitive bidding process, and it does not involve any related party transactions.

7. Are there any delays in the award of this contract?  

No, there are no reported delays in the award of this contract.

8. What is the significance of this contract for IRCON?  

This ₹750.82 crore contract is a major win for IRCON, strengthening its order book and showcasing its capabilities in railway infrastructure projects.

9. Does the promoter or promoter group have any interest in RVNL?  

No, there is no interest of the promoter or promoter group in RVNL, the entity awarding this contract to IRCON.

10. How will this contract impact IRCON's financials?  

This sizable contract will positively contribute to IRCON's revenues and profitability over the next 3.5 years during the project execution period.

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