Kavach is an indigenously developed Automatic Train Protection (ATP) system for Indian Railways, designed to prevent train collisions by automatically activating brakes if a driver fails to respond to signals. It utilizes Radio Frequency Identification (RFID) technology for real-time monitoring and communication, ensuring enhanced safety on the rail network
On 4th September, Indian Railways issued tenders exceeding Rs.2,200 crore for expanding the Kavach automatic train protection system across West Bengal, Tamil Nadu, and Uttar Pradesh, covering around 7,228 route kilometers.
The tenders include components like towers, optical fibers, and dashboards, with installation already in progress on an additional 3,000 route kilometers.
Following the tender announcement, stocks of these two companies involved in developing the Kavach system saw an increase:
Kernex Microsystems Limited
With a market capitalization of Rs.1,406 crore, Kernex Microsystems Limited’s share price surged to an intra-day high of Rs.838.8 per share on Thursday, hitting the 5 percent upper circuit limit, up from its previous close of Rs.798.9 apiece.
Kernex Microsystems plays a crucial role in the Kavach railway system by supplying and installing Train Collision Avoidance System (TCAS) units, enhancing railway safety through innovative technology solutions.
Recently, they secured contracts worth Rs.14.03 crore from the Integral Coach Factory, Chennai, for expanding the Kavach system, showcasing their expertise in railway safety systems.
Also read: Damani stock jumps 4% after receiving order for diamonds worth ₹ 70 Cr from USA
For the quarter ending June FY25, the company reported an extraordinary 2,887.5 percent year-on-year revenue increase, reaching Rs.28.68 crore, up from Rs.0.96 crore in the same quarter last year. Profit after tax surged to Rs.3.57 crore, reversing a net loss of Rs.0.94 crore in Q1 FY24.
HBL Power Systems Limited
With a market capitalization of Rs.17,479 crore, HBL Power Systems Limited’s share price rose to an intra-day high of Rs.644.4 per share on Thursday, up 2.5 percent from its previous close of Rs.628.6 apiece. The price has since retreated and is currently trading at Rs.631 per share
HBL Power Systems supports the Kavach railway system by supplying key components like the Train Collision Avoidance System (TCAS). The company has secured multiple contracts for its deployment across various routes, utilizing its expertise in advanced electronics and communication to develop robust solutions for automatic braking and real-time signal processing.3
Also read: Chemical stock jumps 5% after company to acquire assets of Tata Steel
For the quarter ending June FY25, the company reported an 11.34 percent year-on-year revenue increase, reaching Rs.520 crore, up from Rs.467 crore in the same quarter last year. Profit after tax surged 53.84 percent to Rs.80 crore, compared to Rs.52 crore in Q1 FY24.
Written by – Siddesh S Raskar
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
