In Trade Today Rail Stocks Rallies On the Reforms

Shares of railway associated

companies mainly small-sized
like
Texmaco
Rail
&
Engineering, Titagarh Wagons,
Kalindee
Rail
Nirman
(Engineers), Stone India and
Kernex Microsystems were up
between 3% and 9% on the
NSE in an otherwise subdued
market.

Titagarh Wagons sneak peak:

Titagarh Wagons share price has rallied 8.30 per cent to Rs 130.35 on NSE in intra-day,
extending its Thursdays gain on back of heavy volumes after reporting a good set of
numbers for the quarter ended September 30, 2016 (Q2FY17). At 11:46 AM, over three
lakh shares were traded and the stock was trading at Rs. 120 with the rise of
approximately 4 per cent.
Titagarh Wagons had posted the net profit of Rs 5.24 crore in Q2FY17 compared with
net profit of Rs 0.19 crore in Q2FY16. Total income from operations surged to Rs 98.80
crores in Q2FY17 from Rs. 82.36 in Q2FY16. On December 10, the company
announced that it has bagged an order for construction of two fuel barges for the Indian
Navy in its recently added Shipbuilding vertical.
Earlier, the company has been recognized with registration by the Ministry of Defence
(Navy), Directorate of Ship Production for undertaking construction of Non-Weapon
Platforms up to 120 m length and for all types of Yardcraft through communication
handed out by the said authority on December 07, 2016. Titagarh Wagons designs and
manufactures wagons and coaches, specialized equipments & bridges and heavy earth

moving machineries, ship building etc. Titagarh Wagons is the Top 500 performing
stock for the quarter as picked by Dynamic Levels.

Texmaco Rails Insight:

On 27th October, Texmaco Rail had posted the massive rise in its Q2 net profit. The
company reported the net profit at Rs. 17.07 crores as compared to 2.36 crores in the
corresponding quarter last financial year. The total income from operations was seen at
Rs. 236.57 crores in the Q2FY17 as compared to Rs. 154.52 crores in the same quarter
last financial year.
Texmaco rail share price gained almost 5 per cent in todays trade at NSE, trading at the
intraday high of Rs. 115.90 from the previous close of Rs. 110.50. It is yet another top
500 stock recommended by Dynamic Levels for the quarter.

Kalindee Rail:
Kalindee Rail had posted the net profit of Rs. 1.15 crores in the September quarter of
the ongoing financial year as compared to the loss of Rs. 8.07 crores in the
corresponding quarter last financial year. Kalindees sales have improved considerably
in the Q2FY17, standing at Rs. 128.36 crores as compared to Rs. 82.73 crores in the
same quarter previous financial year.
Today, Kalindee Rail share price gained 4.79 per cent and traded at the intraday high of
Rs. 121.20 as compared to the previous close of Rs. 115.65. Kalindee Rail is also the
Top 500 pick by Dynamic Levels for the quarter.

Whats driving the rally?

Before the month of November ended, it left good news with the rail sector. The news
came that China could help India upgrade its ailing railway infrastructure given New
Delhi is open to Chinese investment in the sector. This came as a reprieve as the

number of accidents happening in the sector has hiked of late. China is quite
experienced in financing and developing railway technology, which can possibly be
used as a reference for speeding up construction in the south Asian country. Some east
African countries, including Tanzania, are reportedly inclined to adopt a Chinese model
for the development of their rail systems. Following the Indore-Patna Express
derailment, India and China might speed up cooperation in infrastructure and China
could offer direct support for upgrading Indias railways.
It was only in August that Chinas largest high-speed train and railway equipment
maker announced that its first joint venture in India had been commenced in Haryana. It
was for the first time that China Railway Rolling Stock Corporation (CRRC), a colossal
state-owned enterprise (SOE) in China with more than 1,75,000 employees, had set up a
joint venture in South Asia.
Also, on 14th December, expressing alarm over loss of lives due to train accidents, a
parliamentary panel has suggested setting up a separate safety fund by the Railways and
appointing a Member (Safety), who is exclusively entrusted with ensuring security of
rail passengers.
Standing Committee on Railways in its latest report tabled in Parliament, has
recommended reviewing the current structure of Railway Board as well as zonal and
divisional levels. The committee suggested that the Railways need to gear up and
overcome the challenges before them to achieve higher level of safety by addressing the
basic reasons of accidents. This will help in coordinating micro-level safety measures
into holistic and macro-level safe rail operations. All these reforms have pushed the rail
stocks up.
With so much reforms going in the rail sector in India, the market might be able to see
more bounces in the prices of the rail stocks. It is a good idea to keep an eye on these
stocks as well.

Disclaimer
The investment advice or guidance provided by way of recommendations, reports or other ways are solely the personal views of the
research team. Users are advised to use the data for the purpose of information and rely on their own judgment while making investment
decision.
Dynamic Equities Pvt. Ltd - SEBI Investment Advisory Reg. No.: INA300002022

Disclosure
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Answers to the Best of our knowledge and belief of Dynamic/ its Associates/ Research Analyst: DYNAMIC/its Associates/ Research
Analyst/ his Relative:

Do not have any financial interest / any actual/beneficial ownership in the subject company.
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Have not received any compensation from the subject company in the past twelve months
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Article Written by
Tanaya Nath