Railway stocks on the Fast Track: Surge Over 100% in One Year

The Indian Railways is poised to add 200 to 250 new trains annually, in addition to the 400 to 450 Vande Bharat trains slated for inclusion in the coming years. Railway stocks have surged by as much as 32% in the past month, accompanied by a more than tenfold rise in average trading volumes.

In response to the escalating passenger numbers attributed to population growth, the Indian Railways has unveiled a robust plan to introduce an additional 3,000 trains over the next four to five years. This strategic move, articulated by Railway Minister Ashwini Vaishnaw, aims to augment the current annual passenger capacity from 800 crore to 1,000 crore.

Performance of Railway stocks in last one year

Indian Rail Finance Corporation (IRFC):

Over the past month, Indian Rail Finance Corporation (IRFC) shares have surged by 6.37%, indicating a positive short-term trend. Meanwhile, over the last six months, the share has jumped by 130.13%. Over the last year, the share has soared by 162.39%, underscoring the stock’s robust long-term performance.

IRCTC:

IRCTC has demonstrated a positive trend in its stock performance, exhibiting gains of 5.71% in the last month. Over the last six months, the company sustained growth, recording an increase of 12.77%, reflecting a consistent upward trajectory. However, a slight decline of 2.50% in the past year.

Rail Vikas Nigam Limited (RVNL):

The shares of Rail Vikas Nigam Limited (RVNL) have seen a modest uptick of 5.58% over the past year, indicating stable and measured growth. Impressively, in the last six months, RVNL experienced a substantial surge of 47.39%, and in the last year, the stock was up by 161.05%, highlighting a robust and impressive long-term performance in the market.

IRCON International:

The shares of IRCON International over the past month have given positive returns of 16.48%. Furthermore, the company sustained substantial growth over the last six months, with an impressive increase of 108.30%, indicating robust mid-term performance. In the last year, IRCON International stocks surged by over 170%.

Titagarh Rail:

Titagarh rail stocks have given positive returns of 26.43% in the past month. Over the last six months, the stock surged 107.92%, indicative of a strong mid-term performance, and a substantial growth of 108.93% in the last one year.

Texmaco Rail:

Texmaco rail shares gave an impressive return of 25.74% in the last month. Over the past six months, the company has witnessed a surge of 183.64% in the stock price, highlighting a strong and sustained mid-term performance. Whereas in the last year, Texmaco rail shares have exhibited substantial growth, rising by 176.54%.

Jupiter Wagons:

The shares of Jupiter Wagons have delivered positive returns of 14.65% in the last month. Whereas, over the past six months, the company has given 133.35%, reflecting a strong and sustained mid-term performance. Jupiter Wagons stocks surged by 317.89%, underscoring the company’s exceptional long-term performance and substantial positive momentum in the market.

Railtel Crop:

The stock of Railtel has surged by 32.62% in the last month. Over the past six months, the company has gained almost 134%, and more than 100% in the last one year, indicative of strong and sustained mid-term and long-term growth.

Recognizing the gradual implementation of Vande Bharat trains across all routes, the railways is exploring an interim solution through the adoption of the push-pull configuration mode. This technology, slated for integration into all newly manufactured coaches, is poised to elevate the efficiency of long-distance trains, resulting in substantial time savings.

Analyst view on the sector:

“The ambitious expansion plan leverages the existing resources of the railway network, boasting 69,000 available coaches, with an additional 5,000 coaches being manufactured annually by railway subsidiaries. The introduction of 200 to 250 new trains each year, in addition to 400 to 450 Vande Bharat trains, signals a transformative phase for the railway sector,” said Anirudh Garg, Partner and Head of Research at Invasset.

Garg also noted that investors are well-advised to closely monitor these developments, as the planned expansion not only signifies a broadening of the railway network but also underscores a commitment to efficiency and an enhanced passenger experience. Against this backdrop, railway stocks emerge as a compelling investment prospect within India’s dynamic transportation sector.