Daijiworld Media Network - Mumbai
Mumbai, Dec 29: After remaining under pressure for several months, India’s railway-linked stocks are showing clear signs of revival, with the sector staging a sharp rally over the past five trading sessions.
The recent surge has added more than Rs 66,500 crore to the combined market capitalisation of railway companies, as investors reposition themselves ahead of the upcoming Union Budget and react to improving revenue prospects within the sector.
Railway stocks had struggled for much of 2025 following a peak in July 2024. Elevated valuations, profit-booking, and tempered expectations around policy support led to a prolonged correction across most counters. The latest upswing indicates a gradual return of investor confidence, supported by fare revisions, budget-related optimism, and stock-specific triggers.
Jupiter Wagons has emerged as the top performer in the current rally, with its shares soaring nearly 37 per cent in just five sessions. Rail Vikas Nigam Limited (RVNL) followed closely, gaining around 27 per cent, while Indian Railway Finance Corporation (IRFC) advanced by over 20 per cent during the same period.
Several other railway-related stocks also posted robust gains. Ircon International, Titagarh Rail Systems, RailTel Corporation of India, Texmaco Rail & Engineering, RITES, and BEML recorded strong double-digit increases, reflecting broad-based buying interest across the sector.
Despite the sharp rebound, analysts note that most railway stocks are still trading well below their earlier peaks, suggesting room for recovery if supportive triggers continue.
A key factor driving the rally has been Indian Railways’ decision to revise passenger fares from December 26. This marks the second fare hike in FY26, with long-distance travel fares increased by 1 to 2 paise per kilometre across ordinary, Mail, and Express trains, while suburban services remain unaffected.
The fare adjustment is expected to generate nearly Rs 600 crore in additional revenue during the remainder of the financial year. Passenger train operations have long been loss-making, with fares estimated to be about 45 per cent below actual costs, and the deficit largely offset by freight earnings.
The latest fare rationalisation is seen as a step toward improving revenue visibility, reducing losses in passenger services, and supporting efforts to strengthen the railways’ operating ratio—factors that have helped reignite investor interest in the sector.