Mumbai : Railway Minister Suresh Prabhu’s maiden budget on Thursday failed to muster investor confidence in the stocks of railway-related firms.
A majority of stocks associated with the railways plunged in the late afternoon trade session Thursday, after Prabhu outlined in the Lok Sabha the 2015-16 development and financial plans for one of the world’s largest railroad networks.
Stocks of companies like Texmaco Rail and Engineering, Container Corporation of India, Kalindee Rail Nirman (Engineers), Stone India, Titagarh Wagons and Cimmco were trading in the red.
However, the stocks of Hind Rectifiers, Kernex Microsystems and Transformers and Rectifiers (India) made gains during the period.
At the Bombay Stock Exchange (BSE), shares of wagon-maker Texmaco Rail and Engineering were trading down 6.03 percent (2.10 p.m.) at Rs.130.80 from the previous close of Rs.139.20.
The scrip of Container Corporation of India slipped by 2.77 percent at Rs.1,530 from the previous close of Rs.1,573.60.
Stocks of Kalindee Rail Nirman (Engineers) decreased 5.33 percent at Rs.133.30, moving down from its previous close of Rs.140.80.
The scrip of another company associated with the railways, Stone India, was trading lower by 6.48 percent at Rs.79.35 from its previous day’s close of Rs.84.85 per equity share.
Selling pressure was also observed in stocks of wagon manufacturer Titagarh Wagons. The company’s scrip declined by 4.06 percent at Rs.555.70 from its previous close of Rs.579.20.
Shares of Cimmco were down 7.19 percent at Rs.71 from its previous close of Rs.76.50.
However, healthy gains were made by Hind Rectifiers, Kernex Microsystems and Transformers and Rectifiers (India).
The stocks of Hind Rectifiers were up 1.73 percent at Rs.79.20 from the previous close of Rs.77.85.
Kernex Microsystems’s stocks fell by 2.26 percent at Rs.47.60 from its previous close of Rs.46.55 per equity share.
The scrip of Transformers and Rectifiers (India) at the BSE was up 2.14 percent at Rs.190.50 from its previous day’s close of Rs.186.50 per equity share.
Investor sentiments were subdued after Prabhu outlined various proposals to bring the public transporter’s finances in order and usher in investments for sustained development.
Various proposals related to increase in investments, erecting new rail infrastructure, rationing of energy consumption and sprucing of passenger amenities were announced by the minister.
Indian Railways, one of the largest railroad networks in the world, is suffering from lack of investments and upgradation of infrastructure to cater to the ever-growing demand of passenger and freight movement.
The minister sought to correct the investment deficit position of the railways by proposing new initiatives for generating financial resources like tying-up with pension funds and other debt-related instruments.
The markets expected the budget to bring-in fiscal stability to the railways and fund inflows for modernisation, in line with the government’s proposal for infrastructure development through the public-private partnership (PPP) model.