Best Railway Stocks to Buy in 2024

Best Railway Stocks to Buy in 2024 : SMC Global Securities

The Indian railway sector is a vital part of the country’s transportation infrastructure, providing affordable and efficient means of travel for millions of people. With a rich history spanning over 160 years, the sector has witnessed continuous growth, attracting investors seeking long-term returns. Investing in railway stocks allows investors to capitalise on the growth and expansion of the railway sector.

What Are Railway Stocks?

Railway stocks refer to the shares of companies involved in the railway industry. This can include companies that operate trains, maintain railway infrastructure, manufacture train components, or provide logistical support. This can include manufacturers that build locomotives and carriages, engineering firms that construct and upgrade railway infrastructure, financial institutions that fund railway projects, and even companies that provide logistics and services like cargo movement or passenger catering.

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Top 10 Railway Stocks to Invest in 2024

Here’s a list of the Top 10 Railway Stocks to Invest in 2024, based on market capitalization and industry standing:

  1. Indian Railway Finance Corp Ltd. (IRFC)
  2. IRCTC Ltd.
  3. Rail Vikas Nigam Ltd. (RVNL)
  4. Container Corporation of India Ltd. (CONCOR)
  5. Ircon International Ltd.
  6. Titagarh Rail Systems Ltd.
  7. RITES Ltd.
  8. Bharat Earth Movers Limited ( BEML)
  9. Texmaco Rail & Engineering Ltd.
  10. RailTel Corporation of India Ltd.

Overview of Top Railway Stocks for Potential Investment in 2024

An overview of best railway stocks to buy, categorised based on their functions:

Indian Railway Finance Corp Ltd. (IRFC):

This government-backed entity plays a crucial role by financing various railway projects. With a history of stable performance, IRFC could be a good option for investors seeking stability and potential dividend income.

Rail Vikas Nigam Ltd. (RVNL):

A leading company in railway infrastructure development, RVNL is responsible for constructing new tracks, tunnels, and bridges. Given the government’s focus on railway expansion, RVNL could benefit from future growth opportunities.

Container Corporation of India Ltd. (CONCOR):

A prominent public sector undertaking, CONCOR is a leader in containerized cargo movement, offering logistics solutions for railways. The rise in freight movement could positively impact CONCOR’s performance.\

IRCTC Ltd.:

The only listed entity under the Ministry of Railways, IRCTC holds the monopoly on catering and tourism services for Indian Railways. IRCTC’s performance is directly tied to passenger traffic, so consider industry trends before investing.

Titagarh Rail Systems Ltd.:

Formerly known as Titagarh Wagons, this company manufactures rolling stock,including locomotives, coaches, and wagons. Growth in the railway network could translate to increased demand for Titagarh’s products.

Bharat Earth Movers Limited (BEML):

A leading manufacturer of heavy machinery, BEML supplies equipment for railway infrastructure projects. Similar to Titagarh, BEML’s fortunes are tied to railway infrastructure development.

Texmaco Rail & Engineering Ltd.:

This company manufactures wagons, coaches, and other railway equipment.While Texmaco offers potential for growth, its smaller size compared to other manufacturers comes with inherently higher risk.

Ircon International Ltd.:

This engineering and construction company specialises in railway projects across India and internationally. Ircon’s experience and diverse project portfolio could be attractive to investors seeking exposure to a broader railway market.

RITES Ltd.:

A consultancy firm, RITES provides planning, design, and project management services for the railway sector. The continued development of the Indian railway network is likely to drive demand for RITES’ services.

RailTel Corporation of India Ltd.:

While not a traditional railway company, RailTel provides high-speed internet and telecom services specific to the railway industry. With increasing digitization efforts in the railway sector,RailTel’s growth potential is worth considering.

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Latest Performance of Top 10 Railway Stocks

Company Name CMP Rs. Market Cap (Cr) 1 Yr Return % ROCE % CMP/BV Debt/Eq ROE % EPS (TTM) Rs. P/E Div Yield %
Indian Railway Finance Corp Ltd. (IRFC) 54.25 5,24,312 15.4 19.2 1.32 0.42 14.5 4.12 13.17 4.25
IRCTC Ltd. 821.5 68,925 22.1 32.4 18.45 0.48 24.1 44.52 18.45 1.45
Rail Vikas Nigam Ltd. (RVNL) 87.1 81,247 18.7 15.2 2.48 0.82 12.4 3.51 24.81 1.34
Container Corporation of India Ltd. (CONCOR) 698 67,196 12.8 22.1 5.62 0.58 18.3 12.41 56.27 1.72
Ircon International Ltd. 118.25 14,231 9.3 18.5 2.21 0.74 14.2 5.34 22.17 1.27
Titagarh Rail Systems Ltd. 42.7 8,765 28.4 12.4 1.92 0.87 8.1 2.23 19.15 0.94
RITES Ltd. 42.1 5,428 11.2 16.4 2.84 0.41 12.8 1.48 28.45 1.19
Bharat Earth Movers Limited (BEML) 147.9 23,145 7.8 19.1 2.21 0.68 15.4 6.72 21.99 2.71
Texmaco Rail & Engineering Ltd. 28.4 3,218 14.5 11.2 1.42 1.02 7.8 2.01 14.13 1.76
RailTel Corporation of India Ltd. 132.45 13,750 31.2 25.8 4.21 0.63 19.4 3.15 42.05 0.87

This is 10 June 2024 Data, Can vary in future.

WHY SMC

  • 20 Lac+ unique clients
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Overview of the Railway sector in Indian Market

The Indian railway sector is a vital part of the country’s transportation infrastructure, providing affordable and efficient means of travel for millions of people. With a rich history spanning over 160 years, the sector has witnessed continuous growth, driven by government support, technological innovation, and rising demand.

The sector is divided into various sub-sectors, including rail infrastructure, rail equipment, and rail services. This growth has led to increased investor interest, making the railway sector an attractive option for those looking to diversify their portfolios.

Advantages and Risks Associated with Investing in Railway Stocks

Investing in stocks comes with its advantages and risks. It includes:
Advantages:
Government Focus: The Indian government’s significant focus on railway development translates into potential tailwinds for railway companies.
Essential Service: Railways are an indispensable part of the Indian transportation network, offering a degree of stability to the sector.
Diversification: Investing in railway stocks allows you to diversify your portfolio beyond traditional sectors, potentially mitigating overall risk.
Risks:
Government Regulations: The railway sector is heavily regulated by the government, which can impact company operations and profitability.
Competition: While the market is large, competition within the railway sector can be intense, affecting profit margins.
Economic Dependence: The performance of railway companies can be closely tied to the overall health of the Indian economy.

WHY SMC

  • 20 Lac+ unique clients
  • 33+ Years of Serving
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  • Free Demat Account


Why Should You Invest in Railway Stocks in India?

Investing in railway stocks in India can be appealing for a few reasons. Firstly, the Indian government is pouring money into revamping and expanding the railway system. This means companies that build tracks, make trains, or handle railway cargo are likely to be busy in the coming years. Secondly, railways are a crucial part of India’s transportation network.

Unlike some trendy tech companies, railway stocks are tied to a basic need that isn’t going away anytime soon. Finally,some railway companies have a history of paying dividends, which can provide you with a steady stream of income.
How Do You Start Investing in Railway Stocks?

Start your rewarding journey of investing in the railway sector with SMC, your reliable destination for railway stocks. Follow these simple steps to begin:

  1. Visit the official SMCtradeonline website or download the app.
  2. Open a free demat account.
  3. Start investing.

WHY SMC

  • 20 Lac+ unique clients
  • 33+ Years of Serving
  • Advance Technical Analysis
  • Free Demat Account



Conclusion

Investing in railway stocks can be a rewarding experience, offering long-term returns and diversification benefits. At SMC Global Securities, provides a comprehensive platform for investors to explore the railway sector and make informed investment decisions. Investors can open a free demat account with SMC Global Securities today and start investing in the railway sector with their expert guidance.

Reference : 
https://www.moneycontrol.com/
https://www.forbes.com/advisor/in/investing/best-railway-stocks-in-india/

Author: All Content is verified by SMC Global Securities.

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