Railway Stocks Surge: Why IRFC, RVNL, and Jupiter Wagons are Rallying Before Budget 2026
21, January 2026. By -Kaushik
The Indian Railways sector is back in the spotlight. With Union Finance Minister Nirmala Sitharaman set to present the Budget on February 1, 2026, investors are aggressively betting on a massive capital expenditure (Capex) boost. This optimism, combined with recent structural reforms, has sent railway stocks into a vertical climb.
Brief Highlights of the Pre-Budget Rally
Massive Gains: Jupiter Wagons led the pack with a 33.2% jump, while RVNL and IRCON surged approximately 20%.
Capex Expectations: Analysts predict a 10-12% increase in railway allocation, potentially hitting a record ₹2.75 to ₹2.80 trillion.
The “Fare Hike” Trigger: A rare nationwide passenger fare hike in late 2025 has improved revenue visibility for the entire ecosystem.
Focus Areas: Massive funding is expected for the Kavach 2.0 safety system, Vande Bharat Sleeper trains, and the Namo Bharat Rapid Rail.
Infrastructure Push: Continued momentum in station redevelopment (Amrit Bharat Scheme) and 100% electrification.
The Three Engines Driving the Rally
1. Expected Record Capex Allocation
The street is buzzing with expectations that the government will continue its “infrastructure-first” approach. After an allocation of ₹2.65 trillion in 2025, the FY27 budget is expected to push this further to support the National Rail Plan. High-speed rail corridors and dedicated freight tracks are likely to be the biggest beneficiaries.
2. Improved Earnings Visibility
Unlike previous “speculative” rallies, the 2026 surge is backed by fundamentals. The passenger fare hike implemented in December 2025 is a structural shift. It narrows the losses in passenger segments, providing IRFC with better lease-rental security and IRCTC with higher service margins.
3. Massive Order Pipelines
Companies like RVNL and IRCON are sitting on order books that provide revenue visibility for the next 3-4 years. Fresh tenders for the “Kavach” anti-collision system and the manufacturing of new-age rolling stock by Titagarh and Texmaco are keeping the momentum alive.
Top Railway Stocks to Watch in 2026
Stock Name Recent Performance Key Driver
Jupiter Wagons +33.2% Leading the wagon manufacturing demand.
RVNL +20% Huge order book for metro and rail infrastructure.
IRFC +15% Sovereign-backed financing for all rail projects.
IRCTC +12% Benefits from fare hikes and digital ticketing growth.
RailTel +16% Focus on digital signaling and railway telecommunications.
Expert Outlook: Should You Buy Now?
Market experts suggest that while the rally is strong, investors should look for “value picks” rather than chasing overextended stocks. Public sector railway stocks (PSUs) offer stability and dividend yield, while private players like Jupiter Wagons and Titagarh Rail Systems offer higher growth potential linked to technology and manufacturing.
The upcoming budget will be the ultimate litmus test. If the government meets or exceeds the ₹2.75 trillion capex mark, this pre-budget rally could easily turn into a post-budget bull run.
Disclaimer :
This blog does not provide financial, investment, or trading advice. All content is for educational and informational purposes only. Please consult a certified financial advisor before making any investment decisions. The author will not be responsible for any financial losses incurred.
