Railway stocks crashed over 60% in last 6 months; Check what analysts have to say

Following the Union Budget 2025, analysts have expressed concerns regarding the railway sector’s financial outlook. The government’s decision to maintain the capex allocation for railways at Rs. 2.55 lakh crore for the FY26, unchanged from the previous year, has been met with disappointment. 

Analysts had anticipated a significant increase in capex to support infrastructure growth, modernize freight corridors, and enhance passenger safety. 

The flat allocation has led to a negative reaction in the stock market and has raised concerns about the pace of modernization and infrastructure development within the railway sector. Analysts had hoped for increased  investments to accelerate projects aimed at improving efficiency and safety. 

The unchanged capex allocation suggests that the government’s focus may be shifting away from traditional infrastructure sectors like railways, to other sectors, potentially impacting the sector’s growth prospects.

Following are a few railway stocks that have crashed over 60 percent in the last six months, along with the views of different brokerages:

1. Indian Railway Catering & Tourism Corporation Limited (IRCTC)

With a market cap of Rs. 53,684 crores, the stock slumped nearly 5 percent to Rs. 662 on Friday. The stock hit its 52-week high at Rs. 1,148.3 on 22nd May 2024, and compared to Friday’s closing price of Rs. 671, the stock is trading at a discount of nearly 42 percent. 

The shares of IRCTC have delivered negative returns, crashing by nearly 28 percent in the last six months, as well as around 18 percent in the last one month. 

In Q3 FY25, the company’s revenue from operations grew marginally by around 9.5 percent to Rs. 1,224.6 crores, while the net profit grew by nearly 13.7 percent YoY to Rs. 341 crores.

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2. Rail Vikas Nigam Limited (RVNL)

With a market cap of Rs. 69,420.7 crores, the stock slumped nearly 6.3 percent to Rs. 328.4 on Friday. The stock hit its 52-week high at Rs. 647 on 15th July 2024, and compared to Friday’s closing price of Rs. 333, the stock is trading at a discount of nearly 49 percent. 

The shares of RVNL have delivered negative returns, crashing by nearly 45 percent in the last six months, as well as around 30 percent in the last one month. 

In Q3 FY25, the company’s revenue from operations declined marginally by around 2.6 percent to Rs. 4,567.4 crores, while the net profit fell by nearly 13.2 percent YoY to Rs. 311.4 crores. 

As of January 2025, the company’s total order book stood at around Rs. 97,000 crores, with Rs. 49,000 crores from bidding works and Rs. 47,600 crores from railway works.

3. Ircon International Limited

With a market cap of Rs. 13,327 crores, the stock slumped nearly 6 percent to Rs. 140 on Friday. The stock hit its 52-week high at Rs. 351.65 on 15th July 2024, and compared to Friday’s closing price of Rs. 351.65, the stock is trading at a discount of nearly 60 percent. 

The shares of Ircon International have delivered negative returns, crashing by nearly 45 percent in the last six months, as well as around 36 percent in the last one month. 

In Q3 FY25, the company’s revenue from operations declined by around 11 percent to Rs. 2,613 crores, while the net profit fell by nearly 65 percent YoY to Rs. 86 crores. 

As of December 2024, the company’s order book stood at Rs. 21,939 crores. The Railways segment has made the largest contribution, accounting for 78 percent of the total, or Rs. 17,075 crores. The Highways segment has contributed 22 percent, amounting to Rs. 4,775 crores, while the remaining Rs. 89 crores come from other segments.

Written by Shivani Singh

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