The countdown has officially begun for Finance Minister Nirmala Sitharaman’s Union Budget presentation on February 1, 2025. Among the sectors closely watching the announcements, Indian Railways remains a critical player due to its vast influence on daily life and economic activities.
Indian Railways, the nation’s largest employer, has seen a consistent focus on modernization and expansion. In the Union Budget of July 2024, the national transporter received a record allocation of Rs 2,65,200 crore for capital expenditure, a significant jump from Rs 28,174 crore in 2013-14. However, despite this historic allocation, railway stocks such as Indian Railway Finance Corporation (IRFC), Texmaco Rail, RailTel Corporation of India, Rail Vikas Nigam Limited (RVNL), and Ircon International saw a dip of 1-5% after the budget speech.
Railway Expenditure Update
In preparation for the upcoming budget, Indian Railways released its expenditure report on January 5, 2025. The report reveals that by December 2024, the Railways had utilized 76% of its allocated budget, spending Rs 1,92,446 crore out of the total Rs 2,65,200 crore. Additionally, 82% of the budgetary outlay for safety was used, reflecting the Railways’ commitment to enhancing passenger security.
Anticipations for Union Budget 2025
As of now, Indian Railways operates 136 Vande Bharat trains nationwide. Expectations are high for the announcement of additional Vande Bharat services and a significant boost to Vande Metro trains designed for suburban commuters. Other anticipated initiatives include increased funding for the Bullet Train project, advancements in the KAVACH safety system, and the integration of artificial intelligence in operations like ticketing.
What’s at Stake for Railway Stocks?
Budget announcements often trigger market reactions for railway-linked stocks. Investors will keep a close watch on updates related to infrastructure upgrades, new train projects, and technological advancements, all of which could influence stock performance.
With Indian Railways’ modernization and expansion remaining at the forefront, this year’s budget could set the stage for transformative growth in the sector. Commuters, investors, and policymakers alike are eagerly awaiting February 1, 2025, to see if the Finance Minister’s announcements meet the high expectations.