Following the weak trends in the Indian stock market, railway stocks are under pressure since morning. Flagship railway stock, IRCTC is down by near 3%, RVNL share price is down by around 2.50%, IRCON International and Railtel Corporation shares are down by around 2%, RailTel Corporation share price, whereas IRFC share price today is down by around 1.90%.
According to stock market experts, railway stocks are under pressure due to a mix of fundamental corrections, margin pressures, and broader market headwinds. FII outflows, rebalancing valuations, and macro headwinds are some other reasons that are dragging the railway stocks, say experts.
Highlighting the reasons behind the selling pressure in the railway stocks today, Avinash Gorakshkar, Founder of Avinash Mentor Research, said, “Railway stocks are currently under pressure and trading down significantly due to a mix of fundamental corrections, margin pressures, and broader market headwinds. Railway companies face margin compression due to lower-margin competitive open-bidding projects (moving away from purely nominated or high-margin rail contracts) and execution challenges in projects like Vande Bharat rollouts.”
“The railway sector faces a wider risk-off wave, FII outflows, and monthly F&O expiry volatility impacting high-beta and capex-heavy PSUs. Investors are closely tracking quarterly results and order book execution speed to see if revenue growth can justify previous high price-to-earnings (P/E) multiples,” said Anuj Gupta, a SEBI-registered market expert.
If this fall in the railway stocks an opportunity for bottom fishing, Avinash Gorakshkar said, “Those looking for a value pick can look at IRFC shares. The company deals in the credit lending and some recent Capex pipeline announcement are expected to benefit IRFC. So, one can look at buying IRFC shares.”