IRFC, RVNL: These Top 2 Railway Stocks Vs Top 2 PSU Bank FD Returns; Where You Earn More?

Indian Railway Finance Corporation (IRFC) and Rail Vikas Nigam Limited (RVNL) are among the top affordable and dividend-paying railway stocks. Both stocks have been trending since last year, giving remarkable returns on the back of the government's push for the transformation of the railway sector. The key common factor between the two stocks is that they fund railway projects. But have their returns been better than traditional fixed deposit rates? Here is a key analysis of top PSU Banks' FD returns vs the two top Railway stocks' returns in 1-year.

Railway Giant Stocks:

IRFC Share Price:

IRFC share price gained by 2.8% to Rs 147.85 apiece on BSE after market hours of April 5th. It is the largest railway company in terms of market value which is to the tune of over Rs 1.93 lakh crore currently.

Despite a couple of periodic selling pressures in early 2024, IRFC's share price has still gained by 47.30% YTD. In a year, the stock has gained by a whopping 437.05% while its all-time gain is nearly 495%.

For instance, if you invested Rs 1 lakh a year ago in IRFC, your corpus value will now be around Rs 5,37,050, of which, you gain about Rs 4,37,050.

As per Trendlyne data, IRFC's weekly average delivery volume is 29.18%, while it is trading above 7 out of 8 SMAs, and above 5 out of 9 Oscillators in bullish zones.

This Mini Ratna was incorporated in September 1999, as an extended arm of the Indian Railways to upgrade, professionalize and manage the catering and hospitality services at stations, on trains and 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.

RVNL Share Price:

RVNL share price was marginally up on BSE after market hours of April 5th to Rs 264.10 apiece. Its market cap is around Rs 55,065.38 crore.

A somewhat similar pattern has been witnessed in RVNL just like its counterpart IRFC. RVNL shares YTD performance is an upside of 45%. In a year, the stock has skyrocketed by 255.26% on BSE. But its all-time gain is a breathtaking 1,237.22%.

So, once again, if you invested Rs 1 lakh in RVNL shares a year ago, your corpus will be around Rs 3,55,260, which includes a return of Rs 2,55,260.

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.

PSU Banks FD Rates:

SBI FD Rates:

Currently, SBI offers a 6.80% rate on FDs below Rs 2 crore on the tenure of 1 Year to less than 2 years, while the rate is at 7% on 2 years to less than 3 years, 6.75% on 3 years to less than 5 years, and 6.50% on 5 years and up to 10 years. This is for general citizens.

Coming to senior citizens, the rates are higher compared to general individuals. SBI is offering 7.30% to elderlies on 1 Year to less than 2 years tenure; while the rate is at 7.50% on 2 years to less than 3 years and 5 years and up to 10 years tenures. Further, a 7.25% rate is given to seniors on 3 years to less than 5 years tenure.

There is also a specific tenure scheme of "400 days" (Amrit Kalash) where SBI is offering a Rate of Interest at 7.10 % w.e.f. 12- April- 2023. Senior Citizens are eligible for a rate of interest of 7.60%. The Scheme will be valid till 30-September-2024.

Using the SBI FDs calculator, Rs 1 lakh investment by Senior Citizens will take their corpus value for 1-year tenure and 5-year tenure to Rs 1,07,502 and Rs 1,44,994 on maturity.

Bank Of Baroda FD Rates:

On FDs below Rs 2 crore, Bank of Baroda is offering a 6.85% rate on 1-year tenure and above 1 year to 2 Years to general citizens. Also, the rate is higher to 7.25% on above 2 years and up to 3 years tenure, but is at 6.50% from above 3 years to 10 years tenures.

In the case of senior citizens, Bank of Baroda is giving a 7.35% rate on 1-year and above 1-year to 2 years tenures to senior citizens, while the rate is at 7.75% on above 2 years to 3 years, and a further 7.15% on above 3 years to 5 years; and lastly at 7.50% on above 5 years to 10 years tenure.

Bank of Baroda also offers 7.15% to general citizens and 7.65% to senior citizens on its special FD scheme called 399 Days (Baroda Tiranga Plus Deposit Scheme).

Using the Bank Of Baroda FD Calculator, if a senior citizen invested Rs 1,00,000 for 1-year and 5-year tenure, their corpus will be around Rs 107,707 and Rs 145,204 on maturity.

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.