IRCTC, RITES, Rail Vikas Nigam share prices rally up to 14%; railways stocks trade higher

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Updated: Jul 02, 2020 11:08 AM

RITES, IRCTC, Rail Vikas Nigam rallied up to 14 per cent on BSE a day after the government informed that Indian Railways has initiated its plans to allow private entities to operate passenger trains

IRCTC, Indian Railways, RITES, Rail Vikas NiganAmong rail-related stocks, RITES share price soared 14 to Rs 293 apiece, Rail Vikas Nigam share price gained 13.5 per cent to Rs 21.45

Railways stocks such as RITES, IRCTC, Rail Vikas Nigam rallied up to 14 per cent on BSE a day after the government informed that Indian Railways has initiated its plans to allow private entities to operate passenger trains. The project would entail a private sector investment of about Rs 30,000 crore. Among rail-related stocks, RITES share price soared 14 to Rs 293 apiece, Rail Vikas Nigam share price gained 13.5 per cent to Rs 21.45, and Ircon International share price advanced 10.36 per cent to Rs 99 apiece on BSE. While IRCTC share price rose 7.3 per cent to Rs 1,463 apiece and BEML gained 3 per cent to Rs 649 apiece.

At 10.40 AM, these rail-related stocks were up in the range of 1.5-7.5 per cent as compared to a 0.8 per cent rise in benchmark S&P BSE Sensex. The Ministry of Railways has invited requests for qualifications (RFQ) for private participation for the operation of passenger train services on 109 pairs of routes through the introduction of 151 modern trains. “This is the first initiative of private investment for running passenger trains over the Indian Railways network. The private entity shall be responsible for financing, procuring, operation and maintenance of the trains,” Ministry of Railways said in a statement. It also added that the majority of trains will be manufactured under ‘Make in India’.

Also read: Great! Indian Railways kick-starts Rs 30,000 crore private trains project – get ready for world-class trains

Under this project, the private entity will pay to Indian railways fixed haulage charges, energy charges as per actual consumption and a share in gross revenue determined through a transparent bidding process. Railway Ministry further informed that trains shall be designed for a maximum speed of 160 kmph and there would be a substantial reduction in journey time. “The running time taken by a train shall be comparable to or faster than the fastest train of Indian Railways operating in the respective route,” it added.

Meanwhile, BSE Sensex was trading 340 points or 0.96 per cent higher at 35,755, while the broader Nifty 50 index was ruling at 10,527, up 97 points or 0.93 per cent in late morning deals.

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