RITES, RVNL: Rail-related stocks gather steam. Analysts remain cautious

Shares of rail-related companies, mainly large-cap players, have outperformed the market in the past one year on expectation of higher outlay for the current financial year 2019-20 (FY20).  The High-speed Railway projects – modernisation of railway stations, the Ahmedabad – Mumbai High-Speed Rail Corridor (MAHSR) and depots are some projects that are expected to gain momentum in FY20.

The Interim Budget presented in February 2019 did not disappoint rail-related companies. Railways saw an allocation of Rs 64,587 crore and capital expenditure outlay of Rs 1.58 trillion for FY20 in Interim Budget 2019 – an increase of over 8 per cent