Rail stocks in mixed cues as FM hikes allocation to Rs 2.4 lakh crore in Budget 2023

1 Feb 2023 , 02:09 PM

Rail stocks give mixed cues as FM hikes allocation to Rs 2.4 lakh crore in Budget 2023

Railway stocks experienced heightened demand following the presentation of the Budget 2023-24 by Finance Minister Nirmala Sitharaman, as she announced an increase in capital expenditure allocation for the railway sector to Rs2.4 lakh crore rupees.

The move will benefit all EPC-based companies, as well as product companies in waggons, signalling, communication, and bearings, among other things.

Following the announcement, some of the stocks rallied. Stocks that rallied include KEC International (+2.20%), with over 2% gain. Siemens (+0.98%) also joined the rally with about 1% gain.

However, Titagarh Wagons (-4.99%) plunged about 5%. RVNL’s (-3.55%) scrip dipped nearly 4% so far in today’s trade.

Railways is a key driver of the PM GatiShakti scheme as well as the National Logistics Policy.

The 2023-24 budget saw a substantial allocation to the railway sector, with the government allocating a capital outlay of Rs2.40 lakh crore, a nine-fold increase from the 2013-14 budget. This substantial allocation aligns with industry expectations and has resulted in a surge in stock prices for railway-related companies such as Titagarh, IRCTC, RVNL, and IRCON, according to Nisha Harchekar, the Head of Equity Research at Fintoo.

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