Rail stocks fall as much as 6 per cent ahead of budget
Railway Minister Suresh Prabhu would unveil the Rail Budget on February 26
Mumbai: Stocks of companies related to the railway sector on February 25 fell up to 6 per cent a day ahead of the rail budget. Shares of Texmaco Rail & Engineering tumbled 2.90 per cent, while BEML dropped 0.50 per cent on the BSE. Shares of Titagarh Wagons fell 6.19 per cent, Kernex Microsystems (5 per cent) and Hind Rectifiers (4.01 per cent).
Two companies — Kalindee Rail Nirman and Stone India — however defied the broader market trend and settled in the positive territory with gains of 1.15 per cent and 0.59 per cent respectively. Railway Minister Suresh Prabhu would unveil the Rail Budget on February 26, which may contain proposals for 'Make in India' initiatives besides enhancing safety and security.
Minister of State for Railway Manoj Sinha had earlier ruled out a reduction in fares in the context of lowering of diesel rates but Prabhu is expected to make a tight rope walk as he tries to bridge the huge gap in finances while presenting his maiden budget in the Lok Sabha. Prabhu is likely to unravel his grand plans of how to decrease the cross-subsidy for passenger service from freight earnings which is touching Rs 24,000 crore and the steps to increase goods transportation share in the national transporter with or without hiking fares.
Besides seeking increased gross budgetary support of about Rs 50,000 cr for the 2015-16 fiscal, railways have sought Rs 20,000 cr from the Finance Ministry as railway safety fund to do away with unmanned level crossings, a major reason for train mishaps across the country. Prabhu will announce joint venture mechanism for implementing projects involving state governments and other external agencies.
As the railway minister has stressed on improvement in passenger amenities before increasing fares, there will be a series of measures including utilisation of CSR funds to improve amenities at rail premises. Prabhu is expected to focus on tapping more revenue channels and could announce some innovative ways for raising resources through non-tariff methods like increasing revenues from advertisements and leveraging surplus land among others.
In line with the 'Swachh Bharat' campaign, Rail Budget is likely to give special attention on cleanliness exercise and a slew of measures like provision for dustbins in all coaches besides proposal to cover 100 more trains under 'On Board Housekeeping Services'. Bio-toilets in trains and stations will be covered under the Clean Train Station Scheme.
Keeping with the NDA government's bullet train promise, Prabhu could announce the way forward for the ambitious high-speed train project between Mumbai-Ahmedabad and survey programmes for the proposed diamond quadrilateral route. The budget could also announce the much-awaited plan to procure 20 train sets for operating on the Rajdhani and Shatabdi routes to reduce travel time.
The budget is likely announce plans for manufacturing coaches to run at a 200-km per hour speed at its Chennai facility in keeping with the Modi government's 'Make in India' initiative. Redevelopment of about 100 stations, leveraging empty spaces for construction of marketing complex and other commercial projects are also on the cards. Introduction of AC rakes in the inter-city services to make the journey more comfortable will also be proposed in the Rail Budget 2015-16.