HBL Power Systems Skyrockets 6%; Hits 52-Week High

6 Jun 2023 , 11:41 AM

HBL Power Systems Ltd witnessed a 6 % surge in its shares during early trade on June 6, reaching a new 52-week high of Rs 129, driven by optimism surrounding the Kavach system.

At the time of writing, shares of the HBL power system were trading 4.22 % higher at Rs 125.95 on the NSE.

The recent tragic train accident in Odisha has sparked expectations of increased government contracts for implementing the Kavach automatic train protection system.

Kavach, the Indian Railway System: India’s Atmanirbhar Bharat initiative has developed Kavach, an indigenous automatic train protection system. With a vision of achieving zero train accidents, the government plans to expand the implementation of Kavach across a vast 2,000-kilometer network in the coming years.

HBL Power Systems, a significant player in the transport-related equipment and services sector, is considered a prime candidate for securing these government contracts. The Kavach system, developed in collaboration with the Research Design and Standards Organisation under the Indian Railways, aims to prevent accidents by automatically applying brakes if the loco pilot fails to do so.

The system is part of the Atmanirbhar Bharat initiative announced in the 2022 Union Budget. The Odisha train tragedy involved a collision between the Bengaluru-Howrah Superfast Express, the Shalimar-Chennai Central Coromandel Express, and a goods train, resulting in significant damage and casualties.

Anticipated government contracts for Kavach, block signaling, and centralized traffic control systems on busy routes have contributed to the rise in HBL Power Systems’ stock prices.

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