2024-07-19 07:34:17
New Delhi: If you had bought shares of the government company Railway Vikas Nigam Limited (RVNL) just before the interim budget on February 1, the value of your investment would have doubled by now. During this period, there has been a lot of growth in the shares related to railways. The share of RVNL has climbed the most by 101 percent. Similarly, the shares of Jupiter Wagons have risen by 64%, Titagarh Rail Systems by 56% and Oriental Rail by 53%. During this period, the combined market cap of the top 12 shares related to railways has increased by about Rs 1.6 lakh crore. If we talk about the last three years, then during this period Titagarh Rail Systems has given a great return of 2,210%. In the interim budget, Finance Minister Nirmala Sitharaman had increased the allocation for railways. It was increased by 5% to Rs 2.6 lakh crore. Many analysts say that the allocation of railways may increase further in the budget to be presented on July 23. Amnish Aggarwal of Prabhudas Lilladher said spending is expected to increase on upgrading rail infrastructure and capacity (rolling stock, electrification, freight corridors, high-speed rail and metros), introducing new trains (Vande Bharat, Vande Metro, Namo Bharat etc) and improving safety (Kavach anti-train collision system).
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How long will the boom last
He said that the heavy capex plan of the railways will benefit companies like IRCON, RVNL, Siemens, Timken India, HBL Power, ABB, BEML, BHEL, Jupiter and Titagarh Wagon. These companies may get many orders, which can lead to a significant rise in their shares. Dr. Vikas Gupta, CEO and Chief Investment Strategist, Omniscience Capital, said that the focus on rapid execution is expected to boost revenue and profit growth. If this happens, the current valuation of railway-related stocks will be correct. If this does not happen, their price may seem high. Experts say that railway stocks can give good returns for the next 5-7 years.