Railway stocks fall up to 8% ahead of Rail Budget 2016
Railway-sector linked stocks on Tuesday tanked up to 8% ahead of Rail Budget 2016 as Railway Minister Suresh Prabhu gears up to present it on Thursday.
BT Online New Delhi Last Updated: February 23, 2016 | 16:06 IST
Shares of Siemens and Allcargo Logistics slipped 2.84 per cent and 3.78 per cent, respectively. Photo: Reuters
Railway-sector linked stocks on Tuesday tanked up to 8 per cent intraday ahead of Rail Budget 2016 as Railway Minister Suresh Prabhu gears up to present it on Thursday.
The stock of Kalindee Wagon was the worst hit and fell as much as 8.68 per cent on the Bombay Stock Exchange (BSE), while Titagarh Wagon lost 8.19 per cent to Rs 126.00.
Kalindee settled the day 6.75 per cent down, while Titagarh 7.43 per cent lower.
Shares of BEML, which supplies equipment to Indian Railways, fell 3.31 per cent intraday and closed 2.62 per cent lower.
Shares of Siemens and Allcargo Logistics slipped 2.01 per cent and 3.46 per cent, respectively.
Financially crippled Railways is standing at a crucial juncture with slight hopes of gaining enough funds from the Finance Ministry.
Prabhu will have to depend mostly on the External Budgetary Resources (EBR) for execution of the capacity augmentation projects, details of which he will disclose in the Budget.
Prabhu has written to the chief ministers of 18 states for taking up rail projects through joint ventures route. Six states, including Maharashtra, Odisha, Kerala, Andhra, Chhatisgarh, have signed MoUs with the railways for forming joint ventures.
While announcement of new trains is unlikely for the second consecutive year, a scheme for premium high-speed parcel trains is slated to be unveiled in the budget.
Facing a decrease in earnings, the railways will press into service many special trains on higher fares, which is an indirect way of raising fares.
The railways have earned Rs 136,079.26 crore as against the target of Rs 141,416.05 crore, a decline of 3.77 per cent.