It has been evident that Domestic institutional investors (DIIs) are becoming one of the crucial driving forces behind the Indian stock market. While their foreign counterparts, FIIs, have mostly been net sellers in the domestic equity market, DIIs infused a whopping ₹7,50,000 crore in the calendar year 2025, portraying continuous faith in India’s growth story.
However, DIIs seem less interested in raising stake in the public sector enterprises (PSEs), which are crucial to the domestic economy. During Q3FY26, DIIs decreased stake in most of the PSEs, barring a few. Even where they showed interest, the increase in stake has been quite restricted, except for one PSE.
It is not that the PSE stocks are performing poorly, which is keeping DIIs away. The numbers don’t support that premise. The Nifty PSE index stocks have reported a 14.4% median return in the past year. This same cohort of stocks, reported a median profit growth of 8.6% during the same period.
But sift through the data and something interesting emerges.
DIIs are buying into one specific PSE which has actually recorded a negative 1-year return of 8.6%.
The stock in question? Container Corporation of India Limited (CONCOR).
DIIs raised stake by 2.9% points during Q3FY26, taking the total holding to 28.7% at the end of the quarter. The top DIIs increasing or buying stake in the company during Q3FY26 include –
- ICICI Prudential Balanced Advantage Fund bought a 1.98% stake
- Nippon Life India Trustee Ltd. increased stake from 1.66% to 2.27%
Let’s try to find what could be the rationale behind this increasing interest in CONCOR.
CONCOR – The backbone of India’s logistics
Container Corporation specializes in multimodal transportation of a variety of goods worldwide. It has a fleet of over 57,000 containers that carry bulk commodities ranging from cement to steel, to even perishable items and other goods.
In India, rail freight plays an integral role in the country’s logistics system, and CONCOR holds a market share of around 55% in the same.
Though the market share has moderated from around 75%-78% in the last decade, it is expected that CONCOR will hold on to this 55% market share going forward, owing to its excellent network and infrastructure setup, which offer an edge compared to its peers. (Source: ICRA Report)
Solid operational performance
CONCOR has delivered a steady, solid operational performance. The logistics giant is not only increasing its number of containers but also the double-stacked trains, which again is one of the most crucial modes of transporting goods in the country.
During FY26 until February, the number of double-stack trains increased by 7% from 4,608 trains to 4,933 trains. Also, during the period, the company commissioned 31 high-speed trains, taking the total count to 413 high-speed trains.
During the period, the company also increased its container volume by approximately 3,800 units.
However, it is not just the increasing number of containers or trains, but the reduction in empty runs indicates the operational efficiency of the company, and the same has reduced by 12% in FY26. The empty runs have primarily reduced in the export-import segment by 21%, while on the domestic front, it has reduced by 8.5%.
Western DFC and JNPT link can be a game changer
CONCOR is focusing on running timetable trains between Dadri and Mundra. Currently, the routes via which freight moves to Mundra and Pipavav include feeder stretches on Indian Railways, which have Axle-load restriction and thus the full payload cannot be utilised.
For this, the link between the Western Dedicated Freight Corridor (DFC) and Jawaharlal Nehru Port Authority (JNPT/JNPA) can be a game-changer.
The DFC allows 25-tonne axle-load and around 80-tonne payload per wagon. With the western DFC – JNPT link, CONCOR will be able to utilise and optimise its high-capacity wagons, increasing the payload per train, and reducing per-unit cost, which can further improve its operating leverage.
Management is expecting this DFC-JNPT link to be completed by the end of FY26; however, they haven’t put out any numbers.
Growth of containerised cargo in India
As per ICRA, the containerised cargo movement in the country is way lower than the global average, even after significant growth in the past couple of years. While the demand is there, especially in the export-oriented industries in the overseas market, dependence on containers is a major challenge for the logistics companies.
CMAS: The domestic tailwinds for logistics
To counter this, the government has introduced the Container Manufacturing Assistance Scheme (CMAS) with an outlay of ₹10,000 crore for next five years, which is aimed at supporting containerised cargo movement in the country.
While CONCOR is not a container manufacturer, it will be a beneficiary as containers produced domestically can be cheaper than the exported counterparts, reducing the overall expenses of the company.
Higher dependence on EXIM cargos
While the external factors, such as the DFC-JNPT link, global demand for export-oriented goods and majority share in the rail freight movement, are playing in favor of CONCOR, the company’s extreme dependence on export-import (EXIM) cargos, which constitute approximately 76% (as of October 2025) of overall volumes, is a major challenge. It is due to significant volatility in the global trade, which can swing the shipping volumes drastically.
Haulage Rates of Indian Railways
Another factor affecting the performance of the company is haulage rates, which are a charge levied by Indian Railways for using locomotives, wagons, the railway network, and fuel, and this comprises around 73% of the total operating expenses of CONCOR. Now, Indian Railways revises these rates at regular intervals which puts pressure on the performance metrics of the company.
Financials
Sales increased by 4.5% year-on-year (YoY) from ₹2,208 crore in Q3FY25 to ₹2,308 crore in Q3FY26. However, the net profit fell by 9% YoY during the period from ₹367 crore to ₹335 crore.
DIIs are perhaps looking beyond these numbers and focusing more on the operational leverage and prospects of the company.
Valuation
The stock is trading at a price/earnings (PE) of 30x, higher than the industry median of 22x. Similarly, the Price/Earnings to Growth (PEG) ratio is at 4.1x, also higher than the industry median of 0.4x, both indicating a premium valuation.
1-Year Share Price Chart of Container Corporation of India Ltd.
Final thoughts
DIIs’ increasing stake in CONCOR, defying the declining profit growth and negative stock return in the last year, perhaps indicates long-term growth of the company.
The institutional investors perhaps are focusing on the structural shift rather than just the current financials, such as containerized cargo movement in India, especially with the different freight corridors in the making, especially the western DFC and JNPT link, CMAS outlay, and others.
However, whether these factors will actually play out in favor of the company or not, only time can tell, and for that, you need to add this stock to your watchlist to keep track of its movement.
We have relied on data from www.Screener.in throughout this article. Only in cases where the data was not available have we used an alternate, but widely used and accepted source of information.
The purpose of this article is only to share interesting charts, data points, and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educational purposes only.
Maumita Mitra is a seasoned writer specializing in demystifying the world of investment for a broad audience. She has a keen eye for detail and a knack for explaining complex financial concepts in the simplest manner possible.
Disclosure: The writer and her dependents do not hold the stocks discussed in this article.
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