Ircon, IRFC, RVNL, other rail stocks extend rally, zoom up to 13% to record highs

Railways stocks are in focus as the government is expected to maintain its focus on infrastructure-led growth in the upcoming Budget. Allocation towards railways may be very high, and it will be watched keenly by the market.

Railway stocks rallied up to 13 percent on January 20, extending their record-breaking run ahead of the Interim Budget on February 1.

Amid strong whiffs of Narendra Modi returning to power after the general elections, analysts expect government policies to continue with sustained focus on infrastructure-led growth along with a focus on 'Make in India'. They believe that allocation towards railways may be very high, and it will be watched keenly by the market.

"This is a pre-election interim budget but will be eagerly looked at as the final budget because of the expectation of the ruling government coming back into power. The GoI has focussed heavily on infrastructure building, both digital and physical. We expect the same focus to remain on all assets like roads, airports, ports and railways," said Mukesh Kochar, national head of wealth at AUM Capital.

Ircon, IRFC, RVNL stocks at all-time highs

Shares of Ircon International surged 13 percent to a fresh record high of Rs 261.50 on the NSE in morning deals. The stock has gained in nine out of the last 10 trading sessions.

This multibagger stock has rallied nearly 50 percent this month. In the past one year, it has gained over 300 percent, outperforming the benchmark Nifty 50, which has surged around 20 percent in this period.

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Shares of IRFC surged up to 1 percent to hit an all-time high of Rs 176.25 on the NSE. January 20's rally pushed its market capitalisation to over Rs 2.3 lakh crore, higher than Power Grid and 21 other Nifty companies.

The IRFC stock has doubled investors' money in three months, rallying over 128 percent in this period. In the last one year, the stock has surged over 400 percent.

It is worth mentioning that IRFC has a low float as the government holds over 86 percent stake in the company. Hence, any move on either side of the stock can result in an extreme share price reaction, warranting caution.

Shares of RVNL too traded in the green for the 10th day in a row on January 20. The stock zoomed 10 percent to a lifetime high of Rs 320.35 on the NSE on high trading volumes. In the last one year, the stock has risen 317 percent. Its three-year returns stand at a whopping 936 percent.

Other railway stocks jump too

Shares of Railtel, IRCTC, Texmaco Rail and Jupiter Wagons also rose up to 8 percent.

Recently in an interview with CNBC-TV18 at the World Economic Forum 2024 in Davos, Railway Minister Ashwini Vaishnaw said progress in expansion and modernisation of the railways is huge.

"Last year we added 5,200 km of new tracks. That’s like adding the entire Swiss network in one year. We are now aiming at a pace of 15 km of tracks a day," he said, adding that out of the Rs 2.4-lakh-crore capex plan, 77 percent has been completed as of date.

Also Read | RVNL shares settle at upper circuit of 20% following multiple block deals

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