Transportation stocks climb after good budgetary allocation

Shares of seven companies associated with the transportation sector rose 0.34% to 3.97% after the government allocated Rs 1.7 lakh crore for the transport sector for 2020-21 in the Union Budget.

IRCTC (up 3.97%), Rites (up 3.35%), Interglobe Aviation (up 2.84%), NELCO (up 2.97%), Siemens (up 1.58%), Container Corporation of India (up 1.47%), Larsen & Toubro (up 0.34%) and BEML (up 0.34%) edged higher.

The Government has allocated Rs 1.70 lakh crore for transportation in the Union Budget 2020-21. One hundred more airports would be developed by 2024 to support Udaan scheme. It is expected that the air fleet number shall go up from the present 600 to 1200 during this time.

"FASTag mechanism encourages us towards greater commercialisation of highways so that National Highways Authority of India (NHAI) can raise more resources. I proposed to monetise at least twelve lots of highway bundles of over 6000 Km before 2024," FM said in her Budget speech.

Among other proposals, more "Tejas" type trains are proposed to connect iconic tourist destinations. High speed train between Mumbai to Ahmedabad would be actively pursued. A 148 km long Bengaluru Suburban transport project is proposed at a cost of Rs 18,600 crore, which would have fares on metro model. Central Government would provide 20% of equity and facilitate external assistance up to 60% of the project cost.

Four station re-development projects and operation of 150 passenger trains would be done through PPP mode. The process of inviting private participation is underway.

The government aims to achieve electrification of 27,000 km of tracks. Accelerated development of highways will be undertaken. This will include development of 2500 Km access control highways, 9000 Km of economic corridors, 2000 Km of coastal and land port roads and 2000 Km of strategic highways. Delhi-Mumbai Expressway and two other packages would be completed by 2023. Chennai-Bengaluru Expressway would also be started, FM said.

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