Railway-related companies' stocks dip post Railway Budget
Shares of railway-related companies, many of which had hit fresh highs ahead of the Railway Budget, derailed after the actual Budget announcement as investors booked profits and there was disappointment over the lack of specifics on several issues.india Updated: Jul 09, 2014 11:03 IST
Shares of railway-related companies, many of which had hit fresh highs ahead of the Railway Budget, derailed after the actual Budget announcement as investors booked profits and there was disappointment over the lack of specifics on several issues.
Traders also said that the Railways' revised Plan outlay of Rs 65,445 crore, up 2% over the interim Budget estimates, was lower than market's expectations.
Texmaco Rail & Engineering (down 19.84%), BEML, Titagarh Wagons, Kalindee Rail and Kernex Microsystems (down 5% each), Hind Rectifiers (down 4.9%) and Stone India (down 4.87%) were the biggest losers. Many of these stocks have given returns of between 50% and 200% since the beginning of this
Many of these stocks had risen significantly in recent days. Texmaco had touched a 52-week high of Rs 149.80 in morning trade. Titagarh Wagons fell 5% to close at Rs 314.05. It had also hit a 52-week high of Rs 342 earlier in the day. Kalindee Rail was the third railway-related stock to hit a 52-week high during the day. It rose to a high of Rs 141.90 before closing at Rs 128.60.
“The budget speech lacked details and the announcements in coming weeks will be important to understand specifics,” said Arvind Mahajan, partner and head of infrastructure and government services, KPMG.
“The correction was due to profit booking,” said an analyst at a local brokerage.
Experts, however, said the Budget did point to the direction of things to come. Though short on details, it has proposed public private partnerships in future projects and railway minister Sadananda Gowda also said he would seek Cabinet approval for allowing foreign direct investment in railways in spheres other than railway operations.