– Railways are part of essential infrastructure, often less affected by slowdowns. Government continues to invest in rail infra even during downturns.
Historical Performance of Railway PSUs in Slowdowns
– Stocks like IRCTC and IRFC remained resilient during COVID and market corrections. Infra-execution PSUs like RVNL and IRCON were less volatile due to assured contracts.
Why Railway Stocks Are Relatively Safer
– Strong government contracts & order books. Many railway stocks are asset-light with consistent margins.
Risks in Economic Downturns
– Lower passenger volumes can hurt IRCTC’s catering and tourism segments. Funding delays in major projects may slow down revenue for infra execution companies.
Investment Insights
– Focus on 2–3 year horizon – Buy low, wait for re-rating