Top railway stocks have witnessed buying sentiment on April 19 as the election polls across the country begin. Railway giants like IRCTC, RVNL, IRFC, Concor and RailTel rallied despite market trends being bearish. The upbeat in railway stocks is an expectation of yet another saffron win in India because there is a behemoth Rs 10 lakh crore to Rs 12 lakh crore plan for driving this sector after the election.
IRCTC Share Price:
Indian Railways catering services provider, IRCTC rose by 1.3% on April 19 to hit an intraday high of Rs 1005.95 apiece on BSE. YTD, IRCTC is up by 12%, while in six months, the stock gained by 42.4%.
Miniratna IRCTC is an extended arm of the Indian Railways to upgrade, professionalize and manage the catering and hospitality services at stations, on trains and in other locations and to promote domestic and international tourism through the development of budget hotels, special tour packages, information & commercial publicity and global reservation systems.
IRFC Share Price:
IRFC, the largest railway stock in terms of market cap, is also up marginally to hit an intraday high of Rs 142.15 apiece. IRFC recently received a buy suggestion for a target price as high as Rs 220, which is possible only after it breaches the Rs 160 level. And chances for the IRFC rally ahead are high since it's the funding NBFC of Indian railways for project execution.
YTD, IRFC shares are up 40%, while in six months, the gain is over 81%.
Indian Railway Finance Corporation (IRFC) was set up on 12th December 1986 as the dedicated financing arm of the Indian Railways for mobilizing funds from domestic as well as overseas Capital Markets. The company is a Miniratna stock.
RVNL Share Price:
RVNL share has zoomed by over 1% to hit an intraday high of Rs 262.3 apiece on Friday on BSE. YTD, the stock is up by 42% on BSE so far. While in six months, the stock is up by 53.4%.
With a Miniratna status, RVNL works as the construction arm of the Ministry of Railways for project implementation and transportation infrastructure development. The organization undertakes project execution from concept to commissioning and creates project-specific SPVs.
4. Container Corporation Of India (Concor) Share Price:
Concor also saw a marginal upside on Friday with the share price hitting an intraday high of Rs 928. YTD, Concor stock is up by 8%, while in six months, the stock gained by 31% on BSE.
The Navratna company signed a MoU with PSA MESA Supply Chain Pte. Ltd, to collaborate in offering seamless and cost-effective end-to-end logistics service to customers. CONCOR is a leading logistics service provider in the country with a pan-India presence at more than 60 container terminals.
RailTel Share Price:
RailTel is the top performer on April 19 under the railway stocks basket. The share price gained by 2% on BSE to hit an intraday high of Rs 370.6 apiece in a single day. YTD, the railway stock is up 4%, while in six months, it surged by 56%.
Mini Ratna, RailTel was incorporated on September 26, 2000, to modernize the existing telecom system for train control, operation, and safety and generate additional revenues by creating a nationwide broadband and multimedia network, laying optical fibre cable using the right of way along railway tracks.
Mega Railway Plans Ahead To Drive Railway Stocks:
At the latest, government officials told ANI that Indian Railways is ready with a 100-day plan post-elections 2024. It includes a focus on various passenger-friendly measures, like a 24-hour ticket refund scheme, a comprehensive super App for various railways facilities, three economic corridors and sleeper Vande Bharat trains.
As per these officials, the new refund scheme will complete the process of refunding the ticket amount to passengers within 24 hours, hence, replacing the current 3-day to 1-week criteria in refunding. Meanwhile, the super app will be equipped with vast services such as booking, cancelling tickets, live tracking, bookings for food, and others.
Also, FM Nirmala Sitharaman has made transformational announcements for the railways sector in the Interim Budget. She said, three major economic railway corridor programmes will be implemented. These are (1) energy, mineral and cement corridors, (2) port connectivity corridors, and (3) high-traffic density corridors.
Further, the rail budget's allocation for FY24-25 is 5% higher than a year ago budget.
IBEF highlights four key driving factors for the railway sector. They are as per its website:
1. Growing Demand: India is projected to account for 40% of the total global share of rail activity by 2050. In 2023-24, traffic revenue is estimated to be Rs 2,64,600 crore (US$ 32.18 billion), comprising 99.8% of the total revenue.
2. Attractive Opportunities: Indian Railways is developing and creating technology in areas such as signalling and telecommunication with 15,000 km being converted into automatic signalling and 37,000 km to be fitted with 'KAVACH', the domestically developed Train Collision Avoidance System.
3. High Investments: Rail infrastructure will see an investment of Rs 50 lakh crore (US$ 715.41 billion) by 2030. Further, Railway infrastructure investment is expected to increase from US$ 58.96 billion in 2013-17RE to US$ 124.13 billion by 2018-22E.
4. Policy Support: The government has allowed 100% FDI in the railway sector.
Disclaimer: The write-up is just for information purposes, and is not a recommendation to buy, sell or hold. We have not done fundamental or technical analysis and have no opinion on the stock mentioned. Neither, the author nor Greynium Information Technologies should be held liable for any losses. Please consult a professional advisor.
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