The capital expenditure for the next fiscal is projected at Rs 11.11 lakh crore, marking an 11.1% increase, underlining its crucial role in driving economic growth. Infrastructure investments have been pivotal in stimulating job creation and attracting private investment. Notably, the road and rail sectors are poised to benefit significantly. In the latest budget, the Ministry of Road Transport and Highways received Rs 2.78 lakh crore, up by 2.8% from the previous year, while Indian Railways was allocated Rs 2.55 lakh crore, following last year’s historic allocation of Rs 2.4 lakh crore. These funds are earmarked for developing three major economic railway corridors and various modernization projects.
The new railway funds will support the creation of three economic corridors focused on energy, mineral, and cement transportation, port connectivity, and high-traffic density routes. Part of the PM Gati Shakti initiative, these projects aim to enhance logistics efficiency, reduce costs, and decongest the rail network. This move is expected to improve both freight and passenger services, thereby accelerating GDP growth and lowering logistical costs.
Indian Railways aims to expand its Vande Bharat train fleet significantly. Currently, approximately 80 Vande Bharat trains operate, with plans to convert 40,000 rail bogies to Vande Bharat standards. This upgrade targets enhanced passenger safety, convenience, and comfort. Ashwini Vaishnaw recently announced trials for Vande Bharat sleeper trains, set to commence soon, with 250 sleeper Vande Bharat trains planned by 2029.
Under Prime Minister Narendra Modi’s leadership, the government continues to prioritize infrastructure sectors like roadways and railways. Indian Railways’ focus remains on increasing passenger and cargo capacity, reducing waitlists, expanding Vande Bharat, Amrit Bharat, and Vande Metro trains, and enhancing safety protocols. The introduction of new variants, such as the sleeper version of Vande Bharat Express, reflects ongoing efforts to modernize passenger travel.
Post-2024 Lok Sabha polls, the Ministry of Railways outlined an ambitious 100-day plan aimed at enhancing passenger experience and modernizing railway infrastructure. Initiatives include streamlining ticket refunds, launching new sleeper trains, completing crucial rail link projects, and constructing India’s first vertical lift railway bridge, the Pamban bridge. Additionally, plans are underway to develop a comprehensive “super app” for passenger convenience.
Indian Railways plans to introduce 50 Amrit Bharat trains this fiscal year, with a vision of 1,000 such trains in the pipeline. Known for their speed of 250 kmph and affordability (1,000 km travel at Rs 454), these trains cater to diverse routes, featuring both AC and non-AC coaches. The Amrit Bharat Express offers enhanced facilities like modern seating, improved luggage racks, mobile charging points, CCTV, and zero-discharge toilets.
Enhancing safety remains paramount for Indian Railways. Investments in advanced safety systems like Kavach are complemented by measures such as infrastructure maintenance, staff training, stricter safety regulations, and the adoption of modern technology. These initiatives aim to create a safer railway network by reducing accidents and ensuring passenger security.
Investors looking to capitalize on potential growth in the Indian Railways sector can consider several stocks. Here are a few to keep on your watchlist:
| S.No. | Name | CMP (Rs) | Mar Cap (Rs crore) | 1Yr return (%) |
| 1 | Oriental Rail | 283.00 | 1,739.30 | 534.95 |
| 2 | I R F C | 172.90 | 2,25,954.48 | 424.11 |
| 3 | Jupiter Wagons | 663.95 | 27,374.28 | 336.5 |
| 4 | Railtel Corpn. | 423.60 | 13,594.91 | 230.6 |
| 5 | Titagarh Rail | 1,480.00 | 19,931.72 | 216.86 |
| 6 | Rail Vikas | 387.60 | 80,815.37 | 215.75 |
| 7 | Ircon Intl. | 267.00 | 25,111.85 | 212.12 |
| 8 | Texmaco Rail | 205.90 | 8,225.01 | 185.7 |
| 9 | BEML Ltd | 4,518.00 | 18,812.90 | 175.59 |
| 10 | Ramkrishna Forgings | 867.20 | 15,678.36 | 79.85 |
Conclusion
The upcoming railway budget holds promise for significant infrastructure developments, safety enhancements, and market advancements. With substantial allocations towards economic corridors, modernization projects, and safety measures, Indian Railways aims to bolster its role in national transportation. Investors should track the developments in railway sector and keep an eye on railway stocks, given their potential growth amidst the sector’s transformative initiatives.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions.
Published on: Jun 21, 2024, 6:11 PM IST
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