Top Railway Stocks with High FII Holdings: The railway as a mode of transport has greatly benefited both passengers and the economy. This promotes economic activity and increases the value of trade. Likewise, even with FIIs. In this article, we will learn and understand some of the top Railway Stocks with high FII Holdings.

Industry Analysis

India has one of the world’s largest railway systems, ranking fourth behind the US, Russia, and China. In the Union Budget for 2023-24, the government allocated US$29 billion to the Ministry of Railways. Recognising its importance in overall infrastructure development, the National Infrastructure Pipeline (NIP) plans to invest Rs. 11.43 lakh crore (US$138 billion) in Indian Railways by 2024-25. The government has set an ambitious target of allocating US$1.4 trillion between 2019 and 2023, with US$750 billion going towards railway infrastructure by 2030.  

Who Are Financial Institutional Investors (FII)?

Foreign Institutional Investors (FIIs) are entities, such as mutual funds, pension funds, and hedge funds, based outside India but investing in the country’s financial markets. FIIs play a crucial role in India’s economic growth by injecting foreign capital, fostering liquidity, and enhancing market efficiency.

telegram channel

Their investments contribute to the development of infrastructure, create job opportunities, and strengthen the Indian rupee. The government welcomes FIIs, as they bring in expertise, diversify investment portfolios, and boost overall market stability. 

Note: If you want to learn Candlesticks and Chart Trading from Scratch, here’s the best book available on Amazon! Get the book now!

Monitoring FII activities is vital for policymakers, as it helps assess the health of the economy, facilitates capital flow regulation, and ensures sustained economic development.

Top Railway Stocks With High FII Holdings

Top Railway Stocks With High FII Holdings #1: Titagarh Rail Systems

Titagarh Rail Systems Logo

Titagarh Wagons, now called Titagarh Railsystems Ltd, was established in Kolkata in 1980 as a rolling stock foundry company. Initially, they manufactured railway castings for the Indian Railways but later diversified into producing freight wagons. Today, they are a well-known mobility company with a strong presence in India and Italy. Their clientele includes Indian Railways, Metro Authorities, the Ministry of Defence, and various businesses.

The company earned revenue through two segments: Freight Rail systems accounted for 80.95% (up 76.81% YoY), while Passenger rail systems accounted for the remaining 19.04% (up 171.90% YoY) in FY23.

As of December, foreign institutional investors (FIIs) held a 20.04% stake in the company, with Smallcap World Fund being one of the prominent FIIs holding a 6.12% stake.

Titagarh earned its revenue from operations of Rs. 2,779.59 crore in FY23 as compared to Rs. 1,467.50 crore in FY22, an increase of 89.40%. Net profits stood at Rs. 125.71 crore as compared to a loss of Rs. -0.68 crore loss in FY22. Their RoE and RoCE stood at 13.51% and 24.49%, respectively.

ParticularsAmountParticularsAmount
CMP₹ 1,024Market Cap (Cr.)₹ 13,810
EPS (TTM)₹ 15.83Stock P/E (TTM)64.75
RoE (%)13.51%RoCE (%)24.49%
Promoter Holding (%)42.46%FII Holding (%)20.04%
Enterprise Value (Cr.)₹ 3,285.09Net Profit Margin (%)4.98%

Top Railway Stocks With High FII Holdings #2: Container Corporation Of India

Container Corporation Of India Logo

Container Corporation Of India was formed in 1989 under the Ministry of Railways. It is a logistics and transportation company. The company transports and handles shipping containers and runs logistics facilities such as dry ports and warehousing. Container Corporation of India is based in India and generates the majority of its revenue domestically. 

The company generates revenue from two segments: EXIM and Domestic. The EXIM segment contributes to the majority of the revenue, accounting for 63.96% of it. The domestic segment includes India-to-India shipping operations, contributing to 36.04% of the revenue in FY23. As of December 2023, approximately 572 FIIs held 19.55% of the company’s shares.

The company earned a revenue of Rs. 8169.12 crore in FY23, which is a 6.74% increase from the revenue of Rs. 7652.73 crore in FY22. The net profits also grew by 11.38% to Rs. 1,173.47 crore. The RoE and RoCE for FY23 stood at 10.45% and 13.25% respectively.

ParticularsAmountParticularsAmount
CMP₹ 937.50Market Cap (Cr.)₹ 57,118
EPS (TTM)₹ 20.07Stock P/E (TTM)46.69
RoE (%)10.45%RoCE (%)13.25%
Promoter Holding (%)54.80%FII Holding (%)19.55%
Enterprise Value (Cr.)₹ 32,443.33Net Profit Margin (%)14.10%

Also Read…

Top Railway Stocks With High FII Holdings #3: Texmaco Rail & Engineering

Texmaco Rail & Engineering logo

Texmaco Rail & Engineering was founded in 1939 in Kolkata by K.K. Birla. It is an engineering and infrastructure company that operates across multiple disciplines and business units. The company has three main segments: Heavy Engineering Division, Steel Foundry, and Rail EPC. Texmaco Rail & Engineering Ltd. offers a wide range of products, including railway goods cars, hydromechanical equipment, industrial structures, steel castings, and pressure vessels.

Texmaco earned  revenue from three main segments in FY23: Heavy Engineering (57.21%), Steel Foundry (10.01%), and Rail EPC (32.77%).

As of December 2023, foreign institutional investors (FIIs) held 9.57% of the shares, with Bank of America securities holding 2.03%, Abu Dhabi Investment Authority holding 1.99%, and the remaining investors holding 5.55%.

The company generated a revenue of Rs. 2,243.27 crore from its operations in the current fiscal year, which is a 38.32% increase compared to the previous year’s revenue of Rs. 1,621.73 crore. The net profit of the company for the current year is Rs. 25.80 crore, which is a 25.73% increase from the previous year’s profit of Rs. 20.52 crore. The company’s RoE and RoCE stood at 1.92% and 8.25% respectively.

ParticularsAmountParticularsAmount
CMP₹ 205.90Market Cap (Cr.)₹ 7,854
EPS (TTM)₹ 2.25Stock P/E (TTM)91.07
RoE (%)1.92%RoCE (%)8.25%
Promoter Holding (%)50.16%FII Holding (%)9.57%
Enterprise Value (Cr.)₹ 2,161.22Net Profit Margin (%)0.51%

Top Railway Stocks With High FII Holdings #4: BEML

BEML Logo

BEML (Bharat Earth Movers Ltd) was established in Bengaluru in 1964 and operates in three different business segments. The mining and construction segment provides mining machinery suitable for both open-cast and underground mines. This segment also includes the company’s holdings in a joint venture that offers contract mining services.

The rail and metro segment provides rail coaches, overhead electric inspection cars, postal vans, and other equipment to the Indian railways. The Defense segment supplies military equipment to the Indian Army and other defense forces.

The company operates under the Ministry of Defense and is not required to disclose revenue segments. Their revenue is generated mainly (94.98%) from the sale of products such as earth-moving equipment, rail and metro products, Defense products, spare parts, wind energy, and sale of scrap. The remaining 5.52% of revenue comes from services and other operating activities.

As of December 2023, Foreign Institutional Investors (FIIs) hold 9.12% of the shares, with notable investors including Ashoka Whiteoak (1.11%) and Abu Dhabi Investment Authority (1.02%), while the remaining FIIs hold 6.99%.

The company’s revenue from operations decreased by 10.11% to Rs. 3,898.94 crore in FY23 from Rs. 4,337.48 crore in FY22. However, the net profits increased by 22.79% to Rs. 157.89 crore in FY23 from Rs. 128.58 crore in FY22. The return on equity (RoE) and return on capital employed (RoCE) stood at 6.52% and 10.04%, respectively.

ParticularsAmountParticularsAmount
CMP₹ 3,611.70Market Cap (Cr.)₹ 15,040
EPS (TTM)₹ 48.21Stock P/E (TTM)74.94
RoE (%)6.52%RoCE (%)10.04%
Promoter Holding (%)54.03%FII Holding (%)9.12%
Enterprise Value (Cr.)₹ 5,580.60Net Profit Margin (%)4.04%

Top Railway Stocks With High FII Holdings #5: Indian Railway Catering & Tourism Corporation

Best Railway Stocks With High FII Holdings - Indian Railway Catering & Tourism Corporation Logo

The Indian Railway Catering and Tourism Corporation Ltd. (IRCTC) was established in 1999 under the Ministry of Railways. Its primary goal is to enhance, professionalize, and manage catering and hospitality services at stations, on trains, and other locations.

Additionally, IRCTC aims to promote domestic and international tourism by developing budget hotels, special tour packages, and global reservation systems, along with providing information and commercial publicity. The company has its registered and corporate offices located in New Delhi.

 In FY23, IRCTC earned 41.69% revenue from Catering, 8.49% from Railneer, 33.82% from Internet Ticketing, 11.63% from Tourism, and 4.34% from State Teertha. As of December 2023, 444 FIIs held 7.34% stake in the company. . 

The company generated a revenue of Rs. 3,541.47 crore from its operations in FY23, marking an impressive increase of 88.51% over the previous year’s revenue of Rs. 1,878.57 crore. In terms of net profit, the company fared well with Rs. 1,005.88 crore in FY23, which is a rise of 52.51% compared to the previous year’s net profit of Rs. 659.55 crore. Moreover, the company’s RoE and RoCE stood at 40.58% and 49.78% respectively.

ParticularsAmountParticularsAmount
CMP₹ 957.60Market Cap (Cr.)₹ 76,608
EPS (TTM)₹ 13.27Stock P/E (TTM)72.16
RoE (%)40.58%RoCE (%)49.78%
Promoter Holding (%)62.40%FII Holding (%)7.34%
Enterprise Value (Cr.)₹ 43,906.27Net Profit Margin (%)28.40%

Conclusion

As we approach the end of the article, it’s worth noting that railway companies have the potential to benefit from the government’s interest in building infrastructure, improving transportation, and enhancing connectivity.

The government aims to reduce logistics costs by implementing policies that focus on supply chain management, connectivity, and exchange hubs. Which companies do you think will benefit from this growth? We’d like to hear your thoughts in the comments section below.

Written by Santhosh

By utilizing the stock screenerstock heatmapportfolio backtesting, and stock compare tool on the Trade Brains portal, investors gain access to comprehensive tools that enable them to identify the best stocks also get updated with stock market news, and make well-informed investment.


Start Your Stock Market Journey Today!

Want to learn Stock Market trading and Investing? Make sure to check out exclusive Stock Market courses by FinGrad, the learning initiative by Trade Brains. You can enroll in FREE courses and webinars available on FinGrad today and get ahead in your trading career. Join now!!