Railways are incurring losses from July 2024, with Texmaco-Ircon and IRFC losing up to 65%; what next?:Railway shares continue to fall.

News Topical, Digital Desk : Railway stocks have been declining since July 2024, for several reasons. A look at the charts reveals that railway stocks reached their highest highs in July 2024 and have been on a downward trend since then. The decline in these stocks began on July 12, 2024. The railway stocks we're going to discuss include Rail Vikas Nigam (RVNL), Indian Railway Finance Corp (IRFC), IRCTC, Railtel Corp (Railtel), Texmaco Rail, and Ircon International.

How much have the shares fallen?

Railway stocks have fallen by more than 65% since July 12, 2024. A major reason for this is the low allocation for the railway sector in the national budget, which has dampened investor expectations. Additionally, weak quarterly results, global uncertainty, and a lackluster response to offers for sale (OFS) have also put pressure on railway stocks.

Which stock fell by how much? (Since July 12, 2024)

Texmaco Rail – 65.31 percent
IRCON International – 59.5%
IRFC – 54.13 percent
RVNL – 52.18 percent
RailTel Corporation – 50.8 percent
IRCT – 45.4 percent

Shares were rising

If we look at the graph, we see that all railway stocks were rising before July 12, 2024. However, they began to decline after that. Almost all stocks were at their 52-week highs.

The period of decline began

Government spending on railway companies remained weak in the first half of FY25. Markets had expected this to pick up in the second half of FY25, but that hasn't happened.

Weak quarterly results: Weak quarterly results from railway companies have worried investors, leading to a fall in stocks.
Low allocation in the Union Budget: The allocation for the railway sector in the budget fell short of investor expectations.
Global uncertainty: Global uncertainty and geopolitical tensions have also put pressure on railway stocks.
Weak response to Offer for Sale (OFS): IRFC's OFS received a weak response, creating negative sentiment for these stocks.

How is the future?

Experts believe that the prospects for railway expansion are strong. However, traders are reacting to each trigger and adjusting their positions until market conditions stabilize. Experts say that these stocks can be viewed from a long-term perspective.