Railway stocks IRFC, RVNL tank up to 5% post Budget! Is the rally over?
However, the stocks have been in a downward spiral since the conclusion of the interim Budget speech in the Lok Sabha on Thursday.
- Feb 5, 2024,
- Updated Feb 5, 2024 6:14 PM IST
Railway stocks were in focus ahead of the interim Budget 2024 as the street was expecting major announcements for this sector. However, the stocks have been in a downward spiral since the conclusion of the interim Budget speech in the Lok Sabha on Thursday.
RVNL stock ended Monday's trading session at Rs 281.30, down 4.47 per cent and IRFC shares ended 5 per cent lower at Rs 160.50. Both stocks have delivered multi bagger returns in the past 6 months. RVNL Stock is up over 100 per cent in the past 6 months and IRFC Shares have delivered over 200 per cent return in the same period.
The Budget allocated a capital expenditure of Rs 2.55 lakh crore for the Indian Railways which was higher than the Rs 2.4 lakh crore announced in the previous year’s Budget. Finance Minister Nirmala Sitharaman also unveiled three new corridors for the railways – the Energy, Mineral, and Cement Corridor, Port Connectivity Corridor, and a High Traffic Density Corridor. However, the brokerages had anticipated a more substantial increase in rail sector capex.
Experts believe that railway stocks experienced a decline, possibly due to concerns over the implementation and impact of announced projects. However, the industry’s long-term fundamentals continue to remain strong due to massive infrastructure needs, the government’s commitment to modernization, and continued focus on passenger growth.
What do the technical charts say?
According to Osho Krishan, Sr. Analyst - Technical & Derivative Research, Angel One Ltd, the intermediate support for IRFC lies around 150-148 odd levels, breaching which a further round of profit booking could trigger for the next potential support zone 138-135 odd levels. The primary trend remains robust, and in-between hiccups are to be looked at as healthy in such bullish parameters.
"The RVNL stock is currently under time-wise correction, which is necessary to cool off the overbought parameters. Technically, the 21 DEMA is placed around 260 odd levels, which even coincides with the 50% Fibonacci retracement of the recent rally and is expected to act as a cushion," he said.
"The primary trend remains buoyant with some in-between hiccups and needs to be reviewed regularly for prudent decision-making," he added.
Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.
Railway stocks were in focus ahead of the interim Budget 2024 as the street was expecting major announcements for this sector. However, the stocks have been in a downward spiral since the conclusion of the interim Budget speech in the Lok Sabha on Thursday.
RVNL stock ended Monday's trading session at Rs 281.30, down 4.47 per cent and IRFC shares ended 5 per cent lower at Rs 160.50. Both stocks have delivered multi bagger returns in the past 6 months. RVNL Stock is up over 100 per cent in the past 6 months and IRFC Shares have delivered over 200 per cent return in the same period.
The Budget allocated a capital expenditure of Rs 2.55 lakh crore for the Indian Railways which was higher than the Rs 2.4 lakh crore announced in the previous year’s Budget. Finance Minister Nirmala Sitharaman also unveiled three new corridors for the railways – the Energy, Mineral, and Cement Corridor, Port Connectivity Corridor, and a High Traffic Density Corridor. However, the brokerages had anticipated a more substantial increase in rail sector capex.
Experts believe that railway stocks experienced a decline, possibly due to concerns over the implementation and impact of announced projects. However, the industry’s long-term fundamentals continue to remain strong due to massive infrastructure needs, the government’s commitment to modernization, and continued focus on passenger growth.
What do the technical charts say?
According to Osho Krishan, Sr. Analyst - Technical & Derivative Research, Angel One Ltd, the intermediate support for IRFC lies around 150-148 odd levels, breaching which a further round of profit booking could trigger for the next potential support zone 138-135 odd levels. The primary trend remains robust, and in-between hiccups are to be looked at as healthy in such bullish parameters.
"The RVNL stock is currently under time-wise correction, which is necessary to cool off the overbought parameters. Technically, the 21 DEMA is placed around 260 odd levels, which even coincides with the 50% Fibonacci retracement of the recent rally and is expected to act as a cushion," he said.
"The primary trend remains buoyant with some in-between hiccups and needs to be reviewed regularly for prudent decision-making," he added.
Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.