Railway stocks are in focus as HSBC maintains a ‘Buy’ rating, highlighting upside potential despite recent challenges. The brokerage has reduced its target price due to delays in metro project executions and slower-than-expected progress on Vande Bharat orders. The revised outlook signals continued optimism for the sector’s long-term growth.
Price Movement
During Monday’s trading session, Titagarh Rail Systems Ltd’s shares reached an intraday high of Rs.1,210.95 per share, rising 0.5 percent from its previous close of Rs.1,205.50 apiece. The shares have retreated since then and currently trading at Rs.1,199.65 per share.
What happened
Reputed brokerage HSBC has kept its ‘Buy’ rating on Titagarh Rail Systems but reduced its target price to Rs 1,425 per share from Rs 1,980, citing delays in metro projects and slower progress on Vande Bharat orders.
The new target price suggests an 18 percent upside from the stock’s last closing of Rs 1,210. The stock has risen over 22 percent this year, outperforming the Nifty 50, which has gained 11 percent.
HSBC has also lowered its revenue and earnings forecasts for FY26 and FY27 by 9-11 percent. However, the expected restart of metro orders after state elections offers a strong opportunity for the company.
Business Segments
Titagarh Rail Systems operates in multiple areas of the railway and transport sectors. It manufactures a variety of freight wagons, designs and produces passenger coaches, and handles the full development of metro rail systems. The company also makes steel castings and components for railways through its foundry division and is involved in building specialized ships for maritime needs.
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Strategic Initiatives
Recently, Titagarh Rail Systems has made progress in line with India’s “Atmanirbhar Bharat” initiative. In partnership with Bharat Heavy Electricals Limited (BHEL), the company secured contracts to upgrade manufacturing units and produce advanced trainsets. Additionally, Titagarh has expanded its global presence by forming joint ventures and collaborations with international companies to access advanced manufacturing technologies.
Financial Performance
In its latest financial update, Titagarh Rail Systems Ltd posted net sales of Rs.1,057 crores for Q2 FY25, marking a 13 percent growth compared to Rs.935 crores in Q2 FY24. The company’s net profit for Q2 FY25 climbed to Rs.81 crores, reflecting a 14 percent increase from Rs.71 crores in the same quarter last year.
Company Overview
Founded in 1984 and based in Kolkata, Titagarh Rail Systems Limited is a prominent Indian manufacturer of rolling stock, including freight wagons, passenger coaches, and metro rail systems. The company has also diversified its operations to include defense projects and shipbuilding.
Written by – Siddesh S Raskar
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