Budget 2024: Railway stocks fall amid lack of major announcements by Sitharaman
Railway stocks witnessed a fall after Interim Budget 2024 announcements. The fall was triggered by some kind of profit booking that followed the lack of a big-bang announcement in Interim Budget for the railway sector.
Shares of Indian Railway Finance Corporation (IRFC), IRCON International, Rail Vikas Nigam (RVNL) dropped 2.85%, RailTel Corporation of India dropped 2.48%, and Texmaco Rail & Engineering dropped 2.09%. IRFC’s stock price dropped 1.80%. There was a 1% to 2% drop in Bharat Heavy Electricals Ltd (BHEL), Titagarh Rail Systems Ltd, and Jupiter Waggons Ltd.
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The sole gainer among the pack was the BEML share price, which touched a 52-week high on Thursday’s session. According to analysts, BEML stock has gained positive traction and continues to move higher in uncharted territory. Overall bias remains positive, and traders should use dips to go longs. ₹3,480 is strong support, whereas ₹3,800 is resistance.
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While presenting the interim budget, Sitharaman revealed plans to extend metro rail and Namo Bharat to other cities, as well as to upgrade 40,000 regular bogies to Vande Bharat standards. In addition, the implementation of three important economic railway corridor programs—energy, port connection, high traffic density, and mineral and cement corridors—will take place.
Railway allocations received an all-time high of ₹2.4 lakh crore from the finance minister in the FY24 (February 2023) budget, and the Street has huge expectation on this front.
Yet, according to Sanjay Moorjani, a research analyst at SAMCO Securities, the FM stated that over 40,000 additional rail bogies will be converted to Vande Bharat coaches following the success of the Vande Bharat trains. Trains like Vande Bharat would be manufactured to benefit stocks like Titagarh Rail Systems, Jupiter Waggons, Siemens, and RVNL. In addition to shortening travel times and boosting tourism nationwide, this will provide even more job possibilities.
Over the previous year, railway stocks witnessed an enormous spike in value. As per trendlyne data, in the past year, Rail Vikas Nigam stock price rose 295.53%, IRFC stock price has surged 422.54%, Ircon International has jumped 284.74%, RailTel Corporation of India rose 243.28%, Texmaco Rail & Engineering Ltd gained 284.21%, Titagarh Rail Systems has risen 370.52%, and Jupiter Wagons Ltd has risen 221.93%.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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Published: 01 Feb 2024, 01:34 PM IST
