RVNL, IRCON & IRFC shares surge up to 15% today; here's what could be probable reasons
A majority of railway counters saw an upward move today, rising up to 15 per cent. RVNL stock soared 14.59 per cent and was seen trading at its 52-week high level of Rs 88.84. Shares of IRCON jumped 10.28 per cent to hit a day high of Rs 69.64 over its previous close of Rs 63.15. In the case of IRFC, the scrip surged 6.95 per cent to touch its day-high level of Rs 30.
- Apr 24, 2023,
- Updated Apr 24, 2023 3:29 PM IST
Railway stocks such as Rail Vikas Nigam Ltd (RVNL), IRCON International Ltd and Indian Railway Finance Corporation Ltd (IRFC) rose sharply in Monday's trade. A majority of railway counters saw an upward move today, rising up to 15 per cent. RVNL stock soared 14.59 per cent and was seen trading at its 52-week high level of Rs 88.84. Shares of IRCON jumped 10.28 per cent to hit a day high of Rs 69.64 over its previous close of Rs 63.15. In the case of IRFC, the scrip surged 6.95 per cent to touch its day-high level of Rs 30.
"PSU stocks are looking good, given their dividend and order book size. For RVNL, debt and cash in hand are almost at the same levels. However, in the case of IRCON, the stock is looking more attractive at the current level with around Rs 4,000 crore of cash from a market cap size of more than Rs 6,000 crore," AK Prabhakar, Head of Capital, IDBI Capital.
On Sunday, it was reported that Indian Railways would begin the production of 120 advanced Vande Bharat Express trains by August 2023. This may be one more probable reason for today's sharp rise in some of the railway counters.
"At least 120 advanced Vande Bharat trains will be manufactured at Marathwada Railway coach factory in Latur, and efforts are on to begin production by August," news agency PTI reported quoting Union minister Raosaheb Danve. The tendering process for coach manufacturing is in the final stages and the contract would be finalised soon, the report also mentioned.
The contract process is underway with a consortium of Russia and India's RVNL and the actual coach production is expected to start by August, it added.
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On the technical front, RVNL was also seen trading higher than the 5-day, 20-, 50-, 100- and 200-day moving averages. The counter's 14-day relative strength index (RSI) came at 80.69. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 12.49. It has a price-to-book (P/B) value of 2.62. The scrip has climbed 28.81 per cent so far in 2023 and 153.37 per cent in the past one year.
IRCON was last seen trading higher than the 5-day, 20-, 50-, 100- and 200-day moving averages. The counter's 14-day RSI came at 79.65. The company's stock has a P/E ratio of 8.18. It has a P/B value of 1.22. The counter has gained 14.04 per cent on a year-to-date (YTD) basis and 59.60 per cent in a year.
For IRFC, the stock was last seen trading higher than the 5-day, 20-, 50- and 200-day moving averages but lower than 100-day moving averages. The counter's 14-day RSI came at 65.60. The company's stock has a P/E ratio of 5.64. It has a P/B value of 0.84. The counter has slipped 10.82 per cent so far this year but has gained 31.87 per cent in a year.
Meanwhile, Indian equity benchmarks rose sharply today, led by gains in banks, financials, consumer and technology stocks.
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Railway stocks such as Rail Vikas Nigam Ltd (RVNL), IRCON International Ltd and Indian Railway Finance Corporation Ltd (IRFC) rose sharply in Monday's trade. A majority of railway counters saw an upward move today, rising up to 15 per cent. RVNL stock soared 14.59 per cent and was seen trading at its 52-week high level of Rs 88.84. Shares of IRCON jumped 10.28 per cent to hit a day high of Rs 69.64 over its previous close of Rs 63.15. In the case of IRFC, the scrip surged 6.95 per cent to touch its day-high level of Rs 30.
"PSU stocks are looking good, given their dividend and order book size. For RVNL, debt and cash in hand are almost at the same levels. However, in the case of IRCON, the stock is looking more attractive at the current level with around Rs 4,000 crore of cash from a market cap size of more than Rs 6,000 crore," AK Prabhakar, Head of Capital, IDBI Capital.
On Sunday, it was reported that Indian Railways would begin the production of 120 advanced Vande Bharat Express trains by August 2023. This may be one more probable reason for today's sharp rise in some of the railway counters.
"At least 120 advanced Vande Bharat trains will be manufactured at Marathwada Railway coach factory in Latur, and efforts are on to begin production by August," news agency PTI reported quoting Union minister Raosaheb Danve. The tendering process for coach manufacturing is in the final stages and the contract would be finalised soon, the report also mentioned.
The contract process is underway with a consortium of Russia and India's RVNL and the actual coach production is expected to start by August, it added.
Also Watch: HDFC Bank vs ICICI Bank: Which stock to buy after Q4 Results
On the technical front, RVNL was also seen trading higher than the 5-day, 20-, 50-, 100- and 200-day moving averages. The counter's 14-day relative strength index (RSI) came at 80.69. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 12.49. It has a price-to-book (P/B) value of 2.62. The scrip has climbed 28.81 per cent so far in 2023 and 153.37 per cent in the past one year.
IRCON was last seen trading higher than the 5-day, 20-, 50-, 100- and 200-day moving averages. The counter's 14-day RSI came at 79.65. The company's stock has a P/E ratio of 8.18. It has a P/B value of 1.22. The counter has gained 14.04 per cent on a year-to-date (YTD) basis and 59.60 per cent in a year.
For IRFC, the stock was last seen trading higher than the 5-day, 20-, 50- and 200-day moving averages but lower than 100-day moving averages. The counter's 14-day RSI came at 65.60. The company's stock has a P/E ratio of 5.64. It has a P/B value of 0.84. The counter has slipped 10.82 per cent so far this year but has gained 31.87 per cent in a year.
Meanwhile, Indian equity benchmarks rose sharply today, led by gains in banks, financials, consumer and technology stocks.
Also read: ICICI Bank shares headed for 40% upside? Here are projections from NB, Equirus & 3 other brokerages