Railway Stocks Trade Higher Ahead of Budget 2024

Stocks of companies related to railways were trading in the positive territory on Thursday morning ahead of the presentation of the interim Budget.Shares of IRCON International rallied 3.26 per cent, Texmaco Rail & Engineering jumped 2.71 per cent, Indian Railway Finance Corporation climbed 2.58 per cent and Rail Vikas Nigam advanced 1.52 per cent on the BSE.The stock of Jupiter Wagons went up 1.46 per cent, Indian Railway Catering and Tourism Corporation (IRCTC) (0.88 per cent) and Titagarh Rail Systems (0.71 per cent).

This budget is highly anticipated as it will provide insights into the future plans and strategies of the national transporter. One of the key areas of focus in the Railway Budget 2024 is the record capital expenditure outlay. In the previous Union Budget 2023-24, the Ministry of Railways had allocated a capital outlay of Rs 2.40 lakh crore, which was the highest-ever outlay. This amount was almost nine times the outlay made in the Financial Year 2013-14. The upcoming budget is expected to further increase the capital expenditure outlay, indicating the government's commitment to the development and modernization of the Indian Railways. This will enable the railway network to enhance its infrastructure, improve passenger amenities, and introduce new trains.

The government, in 2016, decided to merge the Railway Budget with the Union Budget. The late Arun Jaitley, the then Finance Minister, presented the first combined Budget for the financial year 2017-18. Every year, the allocations towards Indian Railways are keenly watched during the Union Budget presentation as a major part of government spending goes to the sector. Prior to 2017, the Railway Budget used to be presented separately a few days ahead of the Union Budget. This 92-year-long practice came to an end when Finance Minister Jaitley delivered the Union Budget for FY 2017-18. Since then, this practice has been followed by the subsequent governments.