Business News/ Markets / Stock Markets/  Multibagger railway stocks IRFC, RVNL and 3 others fall up to 13.5%. Here's why
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Multibagger railway stocks IRFC, RVNL and 3 others fall up to 13.5%. Here's why

Railway PSU stocks, including IRFC and Rail Vikas Nigam, experience a decline in share prices due to weak financial results reported for Q3 FY24. IRFC's net profit dropped by 1.78% and Rail Vikas Nigam's net profit decreased by 6%.

In the interim Budget 2024-2025, the government announced a capital outlay of ₹2.55 lakh crore, which is an improvement of 6.25% compared to the capital outlay of ₹2.40 lakh crore announced in the Union Budget of 2023-2024.Premium
In the interim Budget 2024-2025, the government announced a capital outlay of 2.55 lakh crore, which is an improvement of 6.25% compared to the capital outlay of 2.40 lakh crore announced in the Union Budget of 2023-2024.

Railway PSU stocks, which have gained status as high-wealth creators in a very short period of time, fell sharply in today's session as a result of disappointing financial results reported for the December quarter.

Shares of Indian Railway Finance Corporation (IRFC) ended today' s session with a drop of 13.5% at 133 apiece. This sharp fall came after the company posted weak set of numbers for the December ending quarter. 

The company posted a 1.78% drop in its net profit to 1,604 crore in Q3FY24 as compared to a net profit of 1,633 crore posted in the same period last year. 

Also Read: BSE PSU index sinks 4%. Is the party over for these stocks?

Its revenue from operations improved by 8.42% YoY to 6,742 crore. A significant rise in finance costs, from 4,554 crore to 5,104 crore, impacted its bottom-line numbers.

Before the release of its earnings, the stock experienced profit booking, and the disappointing financial results further intensified the downward movement. Overall, in the current month, it has declined by approximately 20%, following a remarkable 76% rally in January alone. Looking back, the stock delivered a whopping return of 446% between July and January.

Similarly, Rail Vikas Nigam witnessed substantial selling pressure, with its stock finishing today's session with a drop of 11.45% at 229.60 apiece following its weak set of numbers in Q3FY24.

Also Read: Stock market today: Why small-cap index today crashed over 1000 points — explained with 5 reasons

The company reported a YoY drop in both net profit and revenue for the December quarter. Its net profit decreased by 6% to 359 crore from 382 crore, and there was an 8.8% decline from the preceding quarter's net profit of 394 crore. Additionally, revenue from operations dropped to 4,689 crore from 5,012 crore, marking a 6.44% decrease.

Today's fall has pushed the stock to a drop of 25% in the current month so far. Between March 2023 to January 2024, the stock has witnessed a one-way spike, generating a fabulous return of 436%. 

Other railway multibagger stocks, such as RailTel Corporation of India, Ircon International, and IRCTC, also ended today's session with a fall between 4% and 12%. Notably, RailTel Corporation and Ircon International have recently reported healthy financial numbers for Q3 FY24.

However, profit booking is currently driving these stocks lower, as they gained over 100% over the last six months.

Also Read: MCX share price plunges 9% on weak Q3 results; here's what the analyst says

Meanwhile, in the interim Budget 2024-2025, the government announced a capital outlay of 2.55 lakh crore, which is an improvement of 6.25% compared to the capital outlay of 2.40 lakh crore announced in the Union Budget of 2023-2024.

Disclaimer: We advise investors to check with certified experts before making any investment decisions.eal

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Published: 12 Feb 2024, 04:10 PM IST
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