The Indian government has placed a strong emphasis on the railway sector and is pouring in considerable investments, leading to substantial gains for railway companies. Boasting over 121,400 kilometers and a staggering 7,300 stations, Indian Railways stands tall as one of the largest rail networks in the world. With promising projections for growth in the near future, investing in best railway stocks in India for long term growth in India in 2024 may lead to lucrative returns.
Table of Contents
Overview of Best Railway Stocks in India for Long Term Growth
1. Rail Vikas Nigam Ltd
Rail Vikas Nigam Limited is a prominent player in the development of railway infrastructure in India. With a strong focus on project development, implementation, and financial resource mobilization, the company has played a crucial role in various railway initiatives including new lines, doubling, gauge conversion, electrification, metro projects, and bridge construction. Since its inception in 2003, the company has been serving Indian Railways and government entities with its headquarters based in New Delhi, India. Hence it is one of the best railway stocks in India for long term growth.
- Current Market Price – ₹253.65
- Market Capitalisation – ₹57,735
- During the last 12 months, the company has provided a good Return on Equity of 20.70%.
- Annual Net Profit is increasing in the last three years.
- EBITDA has been steadily increasing for the last three years.
- Steady ROE in the region of 15 to 20 for the last three years.
2. Ircon International Ltd
Ircon International Limited is a renowned construction company known for its capabilities in railway projects. With a sharp focus on both building new lines and revamping existing ones, as well as handling electrification works, Ircon has been a vital contributor to the growth of the railway sector since its establishment in 1976. Operating from its headquarters in New Delhi, India, the company also takes on road and highway construction projects, as well as complex developments such as bridge construction. As a key player in infrastructure development, Ircon International is on the second place in the list of Best Railway Stocks in India for Long Term Growth
- Current Market Price – ₹218.55
- Market Capitalisation – ₹21,505
- Annual Net Profit is increasing in the last three years .
- EBITDA has been steadily increasing for the last three years.
- An excellent return on capital employed of 10.93.
- The company has achieved a good return on equity of 15.96%.
3. Rites Ltd
RITES Limited is a leading provider of expert consulting services in the fields of railways, highways, airports, and renewable energy. With four distinct segments, RITES is dedicated to delivering a wide range of specialized services, including feasibility studies, design, maintenance, and complete turnkey solutions. With its headquarters situated in Gurugram, India, the company has been in operation since 1974. Catering to both government and corporate clients, RITES has established a strong presence in India, Asia, and Africa. Hence it is in the list of the best railway stocks in India for long term growth.
- Current Market Price – ₹752.30
- Market Capitalisation – ₹19,260
- The company is earning an excess return in all important areas
- Over the previous 12 months Margin has grown by 15%.
- Excellent return on capital employed (21.89%) and
- Excellent return on equity (18.64%).
- The company has earned a good net margin of 18.48%.
4. Titagarh Rail Systems Ltd
Titagarh Rail Systems is a leading manufacturer and distributor of rail systems. Originally known as Titagarh Wagons, the company specializes in producing a wide range of freight and passenger rail components, such as loco shells, couplers, and unique wagons. In addition, they offer cutting-edge passenger rolling stock such as high-speed electric locos and advanced metro rail systems, along with top-of-the-line propulsion and electrical equipment. With a rich history dating back to 1983, this Kolkata-based company is dedicated to providing top-notch services including maintenance, refurbishing, and system upgrades and hence it grab the place in the list of the best railway stocks in India for long term growth.
- Current Market Price – ₹990
- Market Capitalisation – ₹13,659
- Net profit changed from negative to positive.
- During the last 12 months, the company has provided an excellent ROE of 45.47%
- Annual Net Profit in the last three years is moving higher.
- Net profit has been expanding for the last five quarters.
- Profit before tax has been increasing over the last five quarters.
- EBITDA has been steadily increasing for the last three years.
- Steady growth in EPS over the last four quarters
- Excellent Return On Capital Employed of 11.11.
5. Container Corporation of India Ltd
Container Corporation of India plays a crucial role in the logistics and trade sectors of India. The company, based in New Delhi, was established in 1988 and has since been managing the handling, transport, and warehousing activities in the country. Through its two segments, EXIM and Domestic, it specializes in providing inland container transport via rail, as well as managing port and air cargo complexes. Container Corporation of India focuses on multimodal support. This includes road transport, logistics facilities, and leasing warehousing space. Its goal is to seamlessly integrate different modes of transportation in order to optimize efficiency and maximize success for its clients. Hence it is one of the best railway stocks in India for long term growth.
- Current Market Price – ₹923.20
- Market Capitalisation – ₹57,929
- Over the past three years, there has been a tremendous increase in net profit.
- EBITDA has been steadily increasing for the last three years.
- Excellent Return On Capital Employed of 10.12.
- The company has achieved a good return on equity of 10.23%.
- The company has earned a good net margin of 14.36%.
Read also: Top 5 Highest Dividend Paying Stocks in Nifty 50 – 2024
List of Railway Stocks in India for long Term Growth
| Stock Names | CMP | Market Cap (Cr) | PE Ratio | ROE | EPS |
|---|---|---|---|---|---|
|
Rail Vikas Nigam |
₹253.65 |
₹57,735 |
39.73 |
18.70% |
7.09 |
|
Ircon International |
₹218.55 |
₹21,505 |
24.30 |
15.96% |
9.41 |
|
RITES |
₹752.30 |
₹19,260 |
41.74 |
18.64% |
19.20 |
|
Titagarh Railsystems |
₹990 |
₹13,659 |
53.47 |
15.40% |
18.97 |
|
Container Corp |
₹923.20 |
₹57,929 |
47.37 |
10.23% |
20.07 |
Note: The above figures have been taken from google finance.
Conclusion
The highlighted company emerges as the best railway stocks in India for long-term growth. Its impressive surge in net profit, steady growth in EBITDA, and robust financial metrics such as high ROCE, ROE, and net margin demonstrate its potential for consistent growth. Its consistent positive performance over the last three years solidifies its position as a strong contender in the Indian railway market, making it a promising option for investors seeking sustainable returns.
Frequently Asked Questions (FAQ)
The sudden increase in railway stocks was ascribed to the expectation that the government will announce more funding for the expansion of railway infrastructure in the forthcoming 2024 Budget. These railway stocks have been rising, partly due to expectations of excellent Q3 earnings.
Numerous causes, including population increase, economic expansion, and urbanization, are contributing to the rising demand for railway services. Government Support, Our government typically provides support to enterprises that own railway stocks, which has various advantages in and of itself.