Mumbai, Dec 29 (NationPress) The railway sector in India is experiencing a remarkable recovery after enduring a prolonged phase of stagnation. Over the past five trading sessions, the sector has witnessed a significant rally, resulting in an impressive addition of over Rs 66,500 crore to the market capitalization of railway-related firms. This surge reflects investor optimism as they recalibrate their positions ahead of the Union Budget, responding to positive revenue indicators.

After peaking in July 2024, railway stocks faced considerable pressure throughout most of 2025, leading to sharp corrections as high valuations subsided and hopes for policy support diminished.

The recent upswing suggests a cautious resurgence of investor interest, spurred by a combination of fare increases, budget expectations, and specific developments within companies.

Leading the charge is Jupiter Wagons, which saw its shares soar by nearly 37 percent in just five days, emerging as the top-performing railway stock in this latest rally.

Rail Vikas Nigam Limited also gained approximately 27 percent, while the Indian Railway Finance Corporation saw an increase of over 20 percent during the same timeframe.

Other railway-associated firms, including Ircon International, Titagarh Rail Systems, RailTel Corporation of India, Texmaco Rail & Engineering, RITES, and BEML, also recorded substantial double-digit gains.

Despite this sharp rebound, many railway stocks continue to trade significantly below their prior peaks.

A pivotal factor contributing to this rally has been Indian Railways' recent decision to adjust passenger fares starting December 26.

This marks the second fare increase in FY26, with long-distance travel fares rising by 1 to 2 paise per kilometer across ordinary, Mail, and Express train services.

This adjustment is anticipated to generate nearly Rs 600 crore in additional revenue for the remainder of the financial year, although suburban services were exempted from this increase.

Currently, passenger train operations are running at a loss, with fares estimated to be approximately 45 percent below cost.

These losses are primarily offset by freight income. The latest fare rationalization is expected to enhance revenue visibility and mitigate losses in passenger services, thereby supporting efforts to improve the railways' operating ratio.