Best Indian Railway Stocks in India 2023

30 January 2023
8 min read

One of the first significant booms in Indian investment was driven by Railway Stocks. Railways continue to play an essential role in the economy more than a century later. Businesses in the railway industry provide transportation of both individuals and goods along rail lines. Companies that perform maintenance and switching work are also included in this.

Moreover, Indian Railway Industry is the backbone of India's economy. Over 1.4 million people are employed along its 67,850 km route. As a result, it is India's largest employer.

Due to its size, the Indian Railways is directly connected to many businesses. Regulators are gradually privatizing the industry, even though historically it has been run by government-owned companies, particularly regarding modernizing the ticketing, engineering, and other operations and maintenance realms. As a result, India will likely experience increased demand for Railway Stocks.

The Indian Railways Sector: An Overview

The need for railway services will likely continue to grow due to rising income and population growth. In addition, the enormous size of the Indian Railway network also ensures that private and public businesses that secure lucrative deals related to the Railways, i.e., Indian Railway shares, will continue to operate for the foreseeable future. 

This article will examine various listed Railway related Stocks and determine the best Railway Stocks of 2023.

Top Railways Stocks in India 2023

Let us review the top Indian Stocks in the Railways Sector now that we understand this industry better.

S.No.

Best Railway Stock List

1.

Indian Railway Catering & Tourism Corporation

2.

Container Corporation of India

3.

Indian Railway Finance Corporation  

4.

Rail Vikas Nigam

5.

RITES Ltd.

6.

BEML Ltd.

7.

Titagarh Wagons

Factors to Consider Before Investing in Railway Sector Stocks

Following are some of the factors to take into consideration before investing in the Indian railways stock -

  • Minimal Operating Costs

Railways are viewed as a perpetually cash-rich industry because they do not require high revenue levels to be profitable. This is due to their low operating costs and the fact that the inventory they use only requires minor maintenance.

Additionally, shipping via water or air during a downturn may still be more expensive than using a train for freight. These factors make it possible for the Railway industry to thrive even during a recession.

  • Sustainability & Growth

The railway sector has been growing over the years in a positive direction. It may have faced some ups and downs but has managed to thrive. It has sustained many challenging circumstances and outperformed itself. Hence, it is also necessary to understand the growth rate while investing in railway stocks. 

  • Consistency in Demand

Rail can be slow, but it is effective. With its 24/7 operating model and capacity to pull hundreds of cars with just one locomotive, Rail is well-positioned to take a constantly growing share of the transportation pie in the years to come in a world where the supply chain is under pressure, and fuel efficiency is king.

These railway companies offer a consistent income stream, dependable cash flows, and moderate but long-term revenue growth. So when tech stocks are out of favour, railway Stocks can be an attractive way to diversify for investors looking to keep a growth-focused portfolio on track.

Top Railway Stocks in India: An Overview

Following is the railway share list with their brief overview-

1) Indian Railway Catering & Tourism Corporation

Indian Railway Catering and Tourism Corporation Limited provides online ticketing, catering, and travel services and is one of the best Railway companies in India. The company's main line of business is offering catering and hospitality services at stations, on trains, and in other locations.

Its segments include packaged drinking water, internet ticketing, travel and tourism, and catering and hospitality (Rail Neer). In addition, flight and hotel booking, rail Drishti, e-catering, bus service, vacation packages, tourist trains, hill Railways, charter trains, and other services are among its offerings.

The company offers a variety of vacation tour packages. The business also provides the official IRCTC application, which includes the IRCTC Zone, iPay Payment Gateway, Wallet, and loyalty program.

2) Container Corporation of India

Container Corporation of India Limited (CONCOR) is a holding company. The company's activities include handling rail and road transportation of containers.

Additionally, the company manages logistics facilities, such as dry ports, container freight stations, and private freight terminals. EXIM and Domestic are the two divisions that run it.

The company's Domestic and EXIM divisions carry out the handling, transportation, and warehousing activities. Some of its international offerings include air cargo movements, bonded warehousing, reefer, cold chain services, and factory stuffing and de-stuffing.

Its domestic services include terminal handling fees, door delivery and pickups, and a volume discount programme. For EXIM locations operating at the Terminal/Inland Container Depot of CONCOR, its E-Filing software is a Web-based application. Any importer, exporter, or shipping agent can file their documents, including their billing, and get printouts using this software.

3) Indian Railway Finance Corporation

The Indian Railways' financing division is called Indian Railway Finance Corporation Limited and is based in India. It is considered one of the best railway stocks in India.

The Leasing and Finance segment is how the company conducts business. It concentrates on lending, borrowing, and leasing activities. Financial leasing of rolling stock assets, including powered and unpowered vehicles like coaches, wagons, trucks, flats, electric multiple units, containers, cranes, trollies of all kinds, and other rolling stock components, is the company's main line of business.

It is involved in lending to other organizations under the Ministry of Railways and leasing the government of India's national projects and Railway infrastructure assets (MoR). In addition, it supports capacity-building initiatives and Railway projects.

It primarily focuses on initiatives to expand and decongest the current Railway network. In addition, it serves as a lender for several other railway-related businesses, including Konkan Railway Corporation Limited (KRCL), ICON, and Railtel.

4) Rail Vikas Nigam

Rail Vikas Nigam Limited (RVNL) is engaged in rail development projects. It will be said to be one of the best railway stocks in India 2023.

The Golden Quadrilateral reinforcement projects are what RVNL is concentrating on funding and implementing. Including new lines, doubling, gauge conversion, Railway electrification, metro projects, workshops, significant bridges, cable-stayed bridge construction, and institutional buildings, RVNL completes all types of railway projects.

It is turnkey and handles the entire project development cycle, from conceptualization to commissioning, including the design stages, estimate preparation, contract calling, and project and contract management.

Diva-Kalyan 5th and 6th Lines, Gurup-Saktigarh Ext of 3rd Line, Jakhapura-Haridaspur 3rd Line, Karjoda-Palanpur Doubling, and Civil Engineering Works in Connection with Diesel Loco Component Factory, Dankuni, are just a few of the rail infrastructure projects that RVNL has implemented.

5) RITES Ltd.

RITES Limited is an India-based engineering and consulting firm. The company provides services in transportation infrastructure and related technologies, from concept to commissioning.

Its segments include Domestic Consultancy, International Consultancy, Export Sale, Domestic Leasing, Turnkey Construction Projects, Domestic Power Generation, and Domestic Leasing. Its clients include Railways, highways, airports, ports, ropeways, urban transport, and inland waterways in India and abroad.

It also has business engagements as consultants, engineers, and project managers. Additionally, it offers turnkey services for doubling and electrification, third-party inspection, quality assurance, construction supervision, project management, operations and maintenance, leasing, and export of rolling stock.

It offers its services in about 55 nations across the continents of Asia, Africa, Latin America, South America, and the Middle East. Its subsidiaries include REMC Limited and RITES (Afrika) (Pty) Limited.

6) BEML Ltd.

BEML Limited is an Indian company that conducts business in three main industry sectors: mining and construction, Rail and metro, and defence and aerospace.

Defence ground support equipment, including Tatra-based high mobility trucks, aircraft towing tractors, medium and heavy recovery vehicles, pontoon mainstream bridge systems, and others, are manufactured and supplied by the company's Defense and Aerospace business.

Equipment like hydraulic excavators, bulldozers, wheel loaders, wheel dozers, dump trucks, motor graders, pipe layers, tyre handlers, water sprinklers, and backhoe loaders are manufactured and sold by the company's mining and construction division to a variety of user segments.

Its Rail and Metro division produces and sells rail coaches, metro cars, alternating current electric multiple units (ACEMUs), overhead equipment (OHE) cars, and steel and aluminium wagons to the rail and metro industries. It operates four manufacturing facilities in Bengaluru, Kolar Gold Fields, Mysuru, and Palakkad.

7) Titagarh Wagons

Titagarh Wagons Limited is a holding company based in India. Rail rolling stock, defence, shipbuilding, heavy engineering, and infrastructure are all areas of expertise for the company.

It manufactures and sells Railway waggons, steel castings, heavy earthmoving and mining equipment, bailey, and other products. The business is divided into freight rolling stock, passenger rolling stock, and others.

Its Freight Rolling Stock segment manufactures wagons, loco shells, bogies, couplers, and their components. Its Passenger Rolling Stock includes metro, passenger coaches, train sets, monorail, propulsion equipment, traction motors, and their parts.

Its other segment includes shipbuilding, which provides for designing and building warships, passenger vessels, tugs, and other specialized self-propelled vessels and their components, as well as miscellaneous items such as specialized defence equipment, bridge girders, tractors, and others.

Conclusion

India's Railway industry is on the verge of a revolution. Stake sales or the introduction of high-speed trains. Future industry growth is expected to be enormous. This will open up more opportunities for the business we listed here. This brings us to the conclusion of our article on the best Railway Shares traded on Indian stock exchanges.

Given the previously discussed points, it is clear that railway Stocks will always be in demand because of their high sustainability and growth potential.

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Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.

To read the RA disclaimer, please click here
Research Analyst - Himanshu Sinha

Disclaimer

The stocks mentioned in this article are not recommendations. Please conduct your own research and due diligence before investing. Investment in securities market are subject to market risks, read all the related documents carefully before investing. Please read the Risk Disclosure documents carefully before investing in Equity Shares, Derivatives, Mutual fund, and/or other instruments traded on the Stock Exchanges. As investments are subject to market risks and price fluctuation risk, there is no assurance or guarantee that the investment objectives shall be achieved. NBT do not guarantee any assured returns on any investments. Past performance of securities/instruments is not indicative of their future performance.
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