Railway stocks rally up to 5 per cent on FDI announcement

MUMBAI: Stocks of companies related to railways rallied up to 5 per cent today after the Cabinet fully opened up the railway infrastructure segment, like high-speed trains, for foreign investment.

Shares of Kernex Microsystems India jumped 4.95 per cent, while Stone India climbed 4.88 per cent on the BSE. Among others, Kalindee Rail Nirman Engineers surged 4.73 per cent, Texmaco Rail & Engineering (4.49 per cent) and Titagarh Wagons (0.66 per cent).

Moving ahead with the economic reforms, the Cabinet last night fully opened up the railway infrastructure segment, like high-speed trains, for foreign investment. The Cabinet approved a proposal to open up cash-strapped railways to foreign investment by allowing 100 per cent FDI in areas such as high-speed train systems, suburban corridors and dedicated freight line projects implemented in PPP mode.

The FDI liberalisation in the sector would help in modernisation and expansion of the railway projects. However, FDI will not be allowed in train operations and safety.