Budget 2017 impact: Rail stocks tank on proposed allocation

Rail stocks fell up to 6% as investors were unhappy on the proposed allocation to railways for 2017-18.
 
FM Arun Jaitley in his Budget speech today, proposed a 8.3% higher budgetary allocation for the sector at Rs 1.31 lakh crore, which included a Budget support of Rs 55,000 crore for FY 18. In the previous budget, allocation to Railways was increased to Rs 1.21 lakh crore, which included Rs 45,000 crore as support and safety fund.
 
Among railway stocks, Titagarh Wagons fell as much as 6.6%, Kalindee Rail Nirman Engineers was down 4.9%, Kernex Microsystems shed 4.7%, Texmaco Rail & Engineering lost 4.1% and Hind Rectifiers tanked 2.8%.

 

Transformative measures have to be taken to make Indian railways competitive, Jaitley added in his speech. The service charge on booking of railway tickets through IRCTC to be withdrawn, the FM said adding the IRCTC will be listed on the exchange. He also reiterated that while the Rail Budget is merged, the autonomy of the Railways will stay intact.
 
This was the first time in 92 years that the Rail Budget was merged with the Union Budget and was announced on the Budget Day, breaking from the tradition of presenting it two days ahead of the Union Budget.