 "Railway-related stocks rally up to 18%; IRFC m-cap crosses Rs 2 trillion")
An outlay of Rs 2.4 trillion for the financial year 2023-24 (FY23-24) was made by Finance Minister Nirmala Sitharaman for the railways. According to reports, the interim budget FY24-25 will likely allocate Rs 2.8-3 trillion for the railways to keep its capex momentum intact.
Rail Vikas Nigam (RVNL), Indian Railway Finance Corporation (IRFC), IRCON International, NBCC (India), RailTel Corporation of India and Texmaco Rail & Engineering were up in the range of 5 per cent to 18 per cent. In comparison, the S&P BSE Sensex was up 0.65 per cent at 71,653 at 11:59 AM.
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Among individual stocks, RVNL zoomed 18 per cent to Rs 288.65 on back of two-fold jump in trading volumes. A combined 126 million equity shares of the company changed hands on the NSE and BSE.
RVNL was incorporated to bridge the infrastructure deficit on Indian Railways. RVNL generally works on a turnkey basis and undertakes the full cycle of project development from conceptualisation to commissioning including stages of design, preparation of estimates, calling and award of contracts, project and contract management, etc.
IRFC hit a new high of Rs 160.34, as it rallied 10 per cent in intra-day trade today. In past six trading days, the stock price of state-owned financial institution has zoomed 50 per cent. While, in past six months, it skyrocketed 389 per cent.
A sharp rally in stock price of the company has seen the market capitalisation (market cap) of IRFC cross Rs 2 trillion mark for the first-time ever. Currently, IRFC's market cap stands at Rs 2.10 trillion; the BSE data shows.
IRFC was set up as the dedicated funding arm of the Indian Railways (IR) for mobilizing funds from domestic as well as overseas Capital Markets. IRFC has played a significant role in supporting the expansion of the Indian Railways and related entities by financing a significant proportion of its annual plan outlay.
It aims to be one of the leading Financial Service Companies in the country, for raising funds from the capital market at competitive cost for Railway infrastructure augmentation, duly ensuring that the Corporation makes optimum profits from its operations.
Indian Railways are now poised to take transformational leap in the Amrit Kaal of the post-Independence period and fulfill the vision of 'Viksit Bharat' which includes modern, faster, available on demand passenger services and facilities, a substantial share in freight cargo with ancillary services in logistics parks and domestic industry driven rail infrastructure of highest standards.
A record capex target of Rs 2.60 trillion in 2023-24, up 65.6 per cent when compared to 2022-23, is targeted to initiate the necessary changes for this vision, across the entire network. Achieving India's commitment of net zero carbon by 2070 will rest in part on more rail-bound passenger and cargo movement, IRFC said in FY23 annual report.
Over the years, IRFC's contributions to the Indian Railway sector have been substantial, with cumulative funding surpassing the significant milestone of Rs 5.5 trillion. This remarkable achievement is further bolstered by an impressive Asset Under Management (AUM) figure of Rs 4.66 trillion as of March 31, 2023. With a focused approach aimed at supporting the expansion and modernization of Indian Railways, IRFC remains committed to making the railway network future-ready.
IRFC's role in augmenting the annual plan outlay of Indian Railways by mobilizing funds from diverse financial sources, forming part of Extra Budgetary Resources (EBR) funding, has been commendable. With its robust financial position, unwavering commitment, and strategic vision, IRFC is well-positioned to drive the future growth and success of the Indian Railways and support infrastructure, ultimately fostering progress and prosperity for the nation, the company said.