Titagarh Rail share price: Nuvama retains 'Buy' rating but cuts target; here's why
The competitive landscape for Titagarh Rail includes major players such as Bharat Forge, BEML, and Texmaco Rail. These competitors are also vying for contracts in the rail and metro sectors.
- Aug 13, 2025,
- Updated Aug 13, 2025 9:17 AM IST
Titagarh Rail Systems has reported a significant decline in its first quarter earnings for FY26, primarily due to continued challenges in wheelset availability, which have disrupted wagon production. Revenue and PAT for the quarter fell by 25% and 40% year-on-year, respectively. However, the company has seen an upswing in order inflows recently, with new contracts for metro rail coaches worth approximately Rs 2,000 crore. Nuvama Institutional Equities stated this in their report.
Nuvama Institutional Equities has responded to these developments by reducing its FY26 and FY27 earnings per share (EPS) estimates for Titagarh Rail by 12% and 14%, respectively. The brokerage firm has also adjusted its target price for Titagarh Rail Systems, lowering it from Rs 1,292 to Rs 1,142 while maintaining a 'Buy' rating. This adjustment reflects ongoing supply chain issues and the subdued tendering environment for wagons.
Despite the current production challenges, there are positive indicators for Titagarh Rail. The company's short-term order book has increased to approximately Rs 12,700 crore, translating to a book-to-bill ratio of 3.5x. Furthermore, media reports suggest that Titagarh Rail Systems is the lowest bidder for the Mumbai Metro Line 5 tender, which involves 132 coaches.
The Titagarh Rail management has expressed optimism about resolving the wheelset availability issue, anticipating normalisation beginning in August 2025. Furthermore, Titagarh Rail Systems expects wagon execution and margins in FY26 to align with FY25 levels. The delivery of the Vande Bharat train prototype is anticipated by the second quarter of FY27, with the Ahmedabad Metro project expected to follow by the third quarter of FY26.
The company’s operational performance for Q1FY26 highlighted ongoing production issues. Titagarh Rail Systems recorded revenue of Rs 680 crore, marking a 25% year-on-year and 32% quarter-on-quarter decline. The Ebitda margin fell by 20 basis points year-on-year to 11.1%, with PAT decreasing significantly by 160% year-on-year and 150% quarter-on-quarter. Wagon production was notably impacted, with only 1,628 units produced compared to 2,455 in the previous quarter.
In terms of future projections, Titagarh Rail Systems is poised to increase its production capacity significantly. The company aims to produce 120 metro coaches across Bengaluru and Ahmedabad contracts in FY26, a substantial increase from 12 in FY25. Monthly production capacity is projected to reach 50 cars by the end of FY27.
Titagarh Rail has secured orders worth approximately Rs 2,470 crore in FY26 to date. These include orders for 966 wagons from Indian Railways and the private sector, 36 coaches from Pune Metro, 108 coaches for Mumbai Metro Line 6, and 273 traction motors from Indian Railways. The management anticipates a new wagon tender from Indian Railways by the end of FY26 or early FY27.
The competitive landscape for Titagarh Rail includes major players such as Bharat Forge, BEML, and Texmaco Rail. These competitors are also vying for contracts in the rail and metro sectors, reflecting the industry’s dynamic nature. As Titagarh Rail navigates its production challenges, its ability to stabilise and grow its operations will be critical in maintaining its market position.
Titagarh Rail Systems has reported a significant decline in its first quarter earnings for FY26, primarily due to continued challenges in wheelset availability, which have disrupted wagon production. Revenue and PAT for the quarter fell by 25% and 40% year-on-year, respectively. However, the company has seen an upswing in order inflows recently, with new contracts for metro rail coaches worth approximately Rs 2,000 crore. Nuvama Institutional Equities stated this in their report.
Nuvama Institutional Equities has responded to these developments by reducing its FY26 and FY27 earnings per share (EPS) estimates for Titagarh Rail by 12% and 14%, respectively. The brokerage firm has also adjusted its target price for Titagarh Rail Systems, lowering it from Rs 1,292 to Rs 1,142 while maintaining a 'Buy' rating. This adjustment reflects ongoing supply chain issues and the subdued tendering environment for wagons.
Despite the current production challenges, there are positive indicators for Titagarh Rail. The company's short-term order book has increased to approximately Rs 12,700 crore, translating to a book-to-bill ratio of 3.5x. Furthermore, media reports suggest that Titagarh Rail Systems is the lowest bidder for the Mumbai Metro Line 5 tender, which involves 132 coaches.
The Titagarh Rail management has expressed optimism about resolving the wheelset availability issue, anticipating normalisation beginning in August 2025. Furthermore, Titagarh Rail Systems expects wagon execution and margins in FY26 to align with FY25 levels. The delivery of the Vande Bharat train prototype is anticipated by the second quarter of FY27, with the Ahmedabad Metro project expected to follow by the third quarter of FY26.
The company’s operational performance for Q1FY26 highlighted ongoing production issues. Titagarh Rail Systems recorded revenue of Rs 680 crore, marking a 25% year-on-year and 32% quarter-on-quarter decline. The Ebitda margin fell by 20 basis points year-on-year to 11.1%, with PAT decreasing significantly by 160% year-on-year and 150% quarter-on-quarter. Wagon production was notably impacted, with only 1,628 units produced compared to 2,455 in the previous quarter.
In terms of future projections, Titagarh Rail Systems is poised to increase its production capacity significantly. The company aims to produce 120 metro coaches across Bengaluru and Ahmedabad contracts in FY26, a substantial increase from 12 in FY25. Monthly production capacity is projected to reach 50 cars by the end of FY27.
Titagarh Rail has secured orders worth approximately Rs 2,470 crore in FY26 to date. These include orders for 966 wagons from Indian Railways and the private sector, 36 coaches from Pune Metro, 108 coaches for Mumbai Metro Line 6, and 273 traction motors from Indian Railways. The management anticipates a new wagon tender from Indian Railways by the end of FY26 or early FY27.
The competitive landscape for Titagarh Rail includes major players such as Bharat Forge, BEML, and Texmaco Rail. These competitors are also vying for contracts in the rail and metro sectors, reflecting the industry’s dynamic nature. As Titagarh Rail navigates its production challenges, its ability to stabilise and grow its operations will be critical in maintaining its market position.