In line with the budget announcement of a hike in passenger fares in the range of 2 paisa per kilometre to 30 paisa per kilometre in various categories of trains, most Railway stocks dropped 4-6% on the Bombay Stock Exchange on Wednesday.
Anti-collision systems maker Kernex Microsystems fell 5.2% to Rs 88, while locomotive component supplier Stone India dropped 4.9% to Rs 33.
Wagon builders including Texmaco Rail & Engineering Ltd dropped 6% to Rs 67, and Titagarh Wagons was 4.3% down at Rs 411 (see table).
"The market is disappointed since there is no specific mention on the allocations for each products made by these companies," said independent analyst SP Tulsian. "For example, when the budget said there will be Rs 18,000 crore investment in rolling stock, it does not specify how many wagons are going to be procured. It allocated Rs 2002 crore for signalling system modernisation but did not say how much Railways will spend on anti-collision systems."
However, Jagannatham Thunuguntla, research head, SMC Global Securities, said profit booking led to the fall in prices of Railway stocks. "Lot of expectations were built up in two months. Many of them saw a rally of 50-100% in recent months. For these stocks there is no trigger point other than Railway Budget."