2024-07-08 17:20:01
Stock market today: Despite weakness in the Indian stock market on Monday, railway stocks are witnessing strong buying since early morning deals. Shares of the Indian Railway majors, Ircon International, Rail Vikas Nigam Limited (RVNL), and Indian Railway Finance Corporation (IRFC) witnessed massive upside movement in the Opening Bell. Indian Railway Catering and Tourism Corporation or IRCTC share price also increased by nearly 2 percent. RVNL share price touched a new peak, logging over a 12 percent intraday rise, whereas IRFC share price ascended and climbed to a new peak of ₹206, recording around a 9 percent intraday rise. Ircon share price also hit a new record high of 334.50 apiece on NSE, logging over 7 percent rise on Monday.
According to stock market experts, railway stocks are rising on Monday despite a sideways trend on Dalal Street. This is largely due to the Minister for Railways Ashwini Vaishnav’s disclosure of plans for 2500 new general passengers coaches, and 10,000 additional coaches. Vaishnav’s announcement of the production of 50 new Amrit Bharat Trains, a high-speed and luxury train service, has also fueled the rise in railway stocks. Additionally, the Union Budget expectations of a special focus on the railway infrastructure are working as a catalyst for this upward movement.
Discussing the surge in railway stocks, Sandeep Pandey, Founder of Basav Capital, explained, “The rise in railway stocks can be directly attributed to the Minister for Railways’ announcement of 2,500 new general passenger coaches and 1,000 additional coaches. His unveiling of the production of 50 new Amrit Bharat Trains has sparked significant buying on Monday, driving the upward movement in railway stocks.”
The former Deputy Vice President of HDFC Bank said that Indian railway companies have been working on expanding their Capex, which is expected to keep their business volumes in an uptrend. That’s why bulls are betting high on railway stocks despite the current high valuations in the Indian stock market.
Avinash Gorakshkar, Head of Research at Profitmart Securities, shared, “In November 2023, the railway minister announced the introduction of 3,000 new trains in the next five years. This has set the stage for some significant railway infrastructure-related announcements in the upcoming budget on 23rd July 2024. Given the Indian government’s consistent focus on infrastructure since 2014, the market is eagerly anticipating a growth-oriented union Budget 2024 with a special focus on the energy, power, railways, and other infra segments.”
Disclaimer: The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
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