Indian Railways to publish quarterly results: Suresh Prabhu

MUMBAI: Suresh Prabhu will appraise you of the financial health of railways every three months. Prabhu, Minister Indian Railways, told a gathering of financial market representatives at the BSE on Friday evening that he will make it a norm to announce quarterly results for railways from now. This is the first time that railways will deviate from its norm of giving out key numbers only during its annual budget event.

A brimming Prabhu told his audience that railways this time was not just meeting targets for the first quarter but exceeding them. He said he was expecting that the next big wave of investment in the country after power and telecom to be in railways. The event at BSE was a closed door meeting and invitations were sent by the railway ministry officials. Invitees included representatives of top insurance companies, investment banks, brokers and foreign institutional investors.

“Quarterly numbers from railways is better than annual budget, which is an anomaly and a hang-over of the British raj,” said Vinayak Chatterjee, Chairman, Feedback Infra. “However, quarterly numbers would be effective if it comprises operating numbers, capex and review of other special initiatives like installing bio-toilets and update on various schemes and so on.”

A presentation by Prabhu at the event showed that total earning for Indian Railways for the first quarter ended June were up 14.54% compared to the corresponding quarter last year while there was a growth of 134% in total projected expenditure to Rs 17,734 crore as against budget expectation of 13,231 crore. Railways was undertaking massive accounting reforms to ensure tracking of expenditure, the presentation showed. The presentation also dwelled deeper into revenue mix and key expenditure areas for the railways, something that would come out every quarter now.

“Prabhu’s assurance that railways will give out quarterly numbers will definitely boost investor confidence as it is bare minimum for the sake of greater transparency,” said Alok Churiwala, spokesperson, BSE Brokers Forum.

Cash strapped Indian Railways, world’s largest passenger and fourth largest cargo carrier, is expecting a $120 billion of investment in the next five years. Prabhu’s plans to tap low cost pension and insurance funds that would give it capital for a duration of 20 to 30 years.

“Giving out quarterly results was good step for bringing transparency but a small part of the big picture,” said Ajay Shah. “We should judge Indian Railways based on the work that will be done on the recommendations of the Bibek Debroy committee report.

The Bibek Debroy committee report was mainly for suggesting a road-map for restructuring the Indian Railways. Among other reforms it suggested measures like bringing rail regulator, scrapping the rail budget and making room for more players in an open access regime in the sector.

Key highlights from Prabhu's presentation

65% trains carry passengers yielding less than 30% revenue
35% freight trains yielding 70% revenue, receive low priority
65% of sections on high density network are saturated
492 of 1219 sections (40%) running at 100% capacity
18% network carrying 56% traffic

Projects worth Rs 1 lakh crore expected to be executed through state JVs
Maharashtra commits Rs 10,000 crore
Rs 6000 crore to be raised through tax free bonds
First quarter working expenses grow by 4.22% lower than expected 7.68%