Here’s why railway stocks trade in green

Railway stocks gain as PM Modi launches new capital expenditure program to revamp 508 railway stations.

Five railway stocks were in the spotlight during Monday’s trading session as a result of Prime Minister Narendra Modi’s Sunday announcement of a new capital expenditure (capex) initiative of $24,470 crores to renovate 508 railway stations.

Shares of Ircon International Ltd. and Indian Railway Finance Corporation Ltd. increased by more than 6% and reached a 52-week high, while shares of Rites Ltd., Railtel Corporation of India Ltd., and Jupiter Waggons Ltd. increased by more than 0.4% to 5%.

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The redevelopment is being done through the Amrit Bharat Station Scheme, which was conceptualised earlier this year with the aim of renovating more than 1,300 stations.

The 508 stations are distributed among 27 states and union territories. Of these, 55 stations are located in Uttar Pradesh and Rajasthan, 49 in Bihar, 44 in Maharashtra, 37 in West Bengal, 34 in Madhya Pradesh, 32 in Assam, 25 in Odisha, 22 in Punjab, 21 in Gujarat and Telangana, 20 in Jharkhand, 18 in Andhra Pradesh and Tamil Nadu, 15 in Haryana, and 13 in Karnataka.

PM Modi lay the first stone on Sunday for the rehabilitation of 508 train stations around the country.The stations are being renovated at a cost of 24,470 crore in order to expand passenger capacity, foster job growth, and act as the core of the city.

“With time, railway stations have become the heart of cities. That’s why it’s important that railway stations are modernised and the area is utilised in an optimum manner,” Modi said.

Ircon International’s share price has been in a strong uptrend, and after some consolidation in the previous week, prices have resumed their upward trend by confirming a breakout of a flag pattern, according to Rajesh Bhosale, Equity Technical and Derivative Analyst, Angel One. With 95 acting as a firm support, prices could extend their current advance up to 110 in the near future. Ircon International’s stock price on the BSE started the day at an intraday low of 96.11. The share price of Ircon International reached an intraday high of 102.82 dollars per.

Although profit taking has begun following the all-time high of 505 on July 26, the overall trend is still bullish, and this dip might be viewed as a buying opportunity. Prices can test 500 again, although immediate support is between 420 and 410.