Indian Railways linked stocks on a roll! Titagarh Wagons, Texmaco Rail rally a whopping 20%; here's why

Indian Railways linked stocks were on a roll with their shares rallying up to 20 per cent, and most of them hitting their upper circuits after reports that the Indian Railways' global tender worth Rs 2,500 crore for the supply of long rails opened today at 3 pm.

Titagarh Wagons, the second largest freight wagon manufacturer in India, hit its upper circuit of 20 per cent at Rs 86.55 on the BSE. Texmao Rail & Engineering advanced 20 per cent to Rs 70.80 in intra-day trade. Texmaco Infrastructure added as much as 10 per cent to Rs 61.35, while Hind Rectifiers climbed 9.78 per cent to Rs 116.10 on the BSE. 

According to a PTI report the railways had to invite the global tender for procuring around 4.87 lakh metric tonnes of rails to meet the shortfall of supply from the Steel Authority of India Limited (SAIL).

The financial bids for the rails will be opened at 3 pm.

Seven foreign steel companies and the Jindal Steel and Power Ltd (JSPL) have bid for the contract.

This is the first time in three decades that rail procurement has been opened for the private sector.

JSPL, the only Indian steel maker in the fray, is expected to get an assured order of 20 per cent under the 'Make in India' clause. Reacting to the news, JSPL share price climbed 5.41 per cent to Rs 187.35 on the BSE.  

The foreign entities are Sumitomo Corporation, Angang Group International, Voestalpine Schienen, East Metals, CRM Hong Kong, British Steel France Rail and Atlantic Steel.

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JSPL has been invited by the Indian Railways to be present at the opening of the financial bids this afternoon.

"We have been invited by the Railway Ministry for the purpose," a company official confirmed.

Till now, the national transporter was procuring rails from government-owned SAIL. It decided on an extra global tender after anticipating that SAIL would not be able to supply the 7,17,000 tonnes required for 2017-18 and 2018-19, as estimated at that time.

The Indian Railways is looking at 4,000 km of track renewal in each of the next two financial years --2018-19 and 2019-20. Its estimated cost for 2018-19 is a little above Rs 10,000 crore.