Best Railway Stocks in October 2024 – Based on 5yr CAGR

The Indian railway system is often viewed as the backbone and lifeline of the economy. Spanning thousands of kilometres and nearly encompassing the entire country, it ranks as the 4th largest railway network in the world, following the US, China, and Russia. 

The Railways Board holds a monopoly on rail services in India, overseeing the entire infrastructure. Thanks to its affordability and efficiency, railways remain the preferred mode of transport for many Indians travelling long distances. By 2050, India is expected to contribute to 40% of the total global rail activity. For FY 2024-2025, there is a target to upgrade 40,000 conventional rail bogies to meet ‘Vande Bharat’ standards.​ In this article, check the best railway sector stocks in October 2024 in India, based on their 5-yr CAGR.  

Best Railway Stocks in India in October 2024 – 5yr CAGR Basis

Note: The best railway stocks list provided here is as of September 26, 2024. The stocks are sorted based on the 5Y CAGR. 

Overview of the Best Indian Railways Stocks

• Jupiter Wagons Ltd

Jupiter Wagons is the premier manufacturer of railway wagons, components for passenger coaches, and alloy steel casting for rolling stack and track. In FY 2024, the company’s total income was ₹3,66,827.91 lakh, increased from ₹2,07,333.45 lakh in FY 2023. During the fiscal 2024, the profit was ₹33,101.74 lakh, up from ₹12,067.51 lakh in FY 2023. 

Key metrics:

• Return On Equity (ROE): 27.23%
• Return on Capital Employed (ROCE): 28.65%

• Titagarh Rail Systems Ltd

Titagarh Rail Systems specialises in developing advanced transportation solutions, including semi-high-speed trains, urban metros, passenger coaches, propulsion equipment, and a diverse range of wagons, including specialised types. In FY 2024, the company’s total income reached ₹3,89,310.75 lakh, up from ₹2,82,217.34 lakh in FY 2023. The profit for FY 2024 was ₹28,843.38 lakh, a significant increase from ₹13,463.33 lakh in FY 2023. 

Key metrics:

• ROE: 17.99%
• ROCE: 18.49%

• Rail Vikas Nigam Ltd

Rail Vikas Nigam Ltd takes up different types of Rail infrastructure projects assigned by MoR, including doubling, new lines, gauge conversion, major bridges, railway electrification, etc. In FY 2024, the company’s total income reached ₹23,074.80 crore, up from ₹21,278.01 crore in FY 2023. The profit for FY 2024 was ₹1,574.47 crore, an increase from ₹1,341.75 crore in FY 2023. 

Key metrics:

• ROE: 19.69%
• ROCE: 17.44%

• Ramkrishna Forgings Ltd

Ramkrishna Forgings Ltd provides top-quality forged, machined, and fabricated products to a variety of industries, including railways, agricultural equipment, mining and construction, power, oil and gas, and more. In FY 2024, the company’s total income reached ₹3,98,380.41 lakh, up from ₹3,19,685.19 lakh in FY 2023. The profit for FY 2024 was ₹34,143.52 lakh, an increase from ₹24,810.84 lakh in FY 2023. 

Key metrics:

• ROE: 17.05%
• ROCE: 16.33%

• Oriental Rail Infrastructure Ltd

Oriental Rail Infrastructure Ltd specialises in the manufacturing, purchasing, and selling of various types of recron, seat and berth products, as well as compreg boards. In FY 2024, the company’s total income reached ₹52,893.22 lakh, up from ₹32,721.96 lakh in FY 2023. The net profit after tax for FY 2024 was ₹3,000.87 lakh, an increase from ₹318.72 lakh in FY 2023.

Key metrics:

• ROE: 15.23%
• ROCE: 15.13%

Railways Sector Growth in India

By the end of FY24, Indian Railways achieved a total revenue of ₹2.40 lakh crore (~US$28.75 billion). The number of passengers rose by 520 million, reaching a total of 648 million in FY 2023-24. In FY24, freight loading reached over 1,500 MT, compared to 1,512 MT in FY23. For 2024-25, the targeted capital expenditure for the railways is US$30.33 billion (around ₹2.52 lakh crore). As of January 31, 2024, 41 Vande Bharat trains are operational on the Indian Railways, connecting states through a Broad Gauge (B.G.) electrified network. 

The Indian railway network is expanding at a robust pace, with projections indicating that it will become the 3rd largest railway market globally within the next 5 years, accounting for 10% of the global market share. Indian Railways (IR) is actively pursuing the goal of achieving Net Zero Carbon Emissions by 2030. 

Inspired by what you’ve read? Take the next step and download the Angel One investment app to put your investment knowledge into practice.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.