IRFC Shares Soar by 19%, Hitting 52-Week High Amid Strong Railway Sector Growth and Heavy Trading Volumes

Before Market Opens
15 January, 2024

The recent surge in the share price of Indian Railway Finance Corporation Ltd (IRFC) can be attributed to several factors:

1. **Overall Growth in Railway Sector:** IRFC has been benefiting from the strong growth observed in the overall railway sector. This growth is partly due to the Indian Ministry of Railways’ plan to seek Cabinet approval for an investment program worth Rs 5.25 lakh crore, planned to span from 2024 to 2031.

2. **High Trading Volumes:** The stock witnessed a significant increase in trading volume. For instance, in one week, the stock of this state-owned financial institution surged 32%, with a peak increase of 9% in a single day amid heavy trading volumes.

3. **Strong Performance in 2023:** IRFC shares have shown a notable increase over the past year, with gains exceeding 202% over the year and over 103% since the beginning of 2023.

4. **Market Capitalization:** Following this rally, IRFC has become the most valuable railway PSU, with a market capitalization exceeding Rs 86,000 crore.

It’s important to note that while analysts remain bullish about the growth of the railway sector, some advise caution given that the stock is currently overbought.

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