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Published: September 6, 2023
Updated: September 6, 2023

PSUs IRFC and MMTC Soar 50% in Three Days Amidst Heavy Trading Volumes

In a remarkable surge, the shares of two public sector undertakings (PSUs), Indian Railway Finance Corporation (IRFC) and MMTC, have skyrocketed by up to 20 percent on the BSE during Tuesday's intra-day trade. This extraordinary ascent comes on the back of heavy trading volumes and marks a 50 percent surge within the past three trading days.

IRFC's Phenomenal Rise:

IRFC, one of the PSUs in focus, saw its shares rally by an impressive 14 percent, reaching a new high of Rs 75.72 on the BSE. In just three trading days, IRFC's stock price has surged by an astonishing 51 percent. Notably, the average trading volumes for IRFC have surged three-fold on the same day.

Massive Trading Activity:

Until 02:15 PM, a staggering 519 million equity shares, equivalent to nearly 4 percent of the total equity of IRFC, changed hands on both the NSE and BSE. To put this into perspective, the S&P BSE Sensex, during the same period, saw a modest 0.09 percent increase, reaching 65,689.

IRFC's Impressive Market Capitalization:

From July onwards, IRFC's stock price has nearly doubled, experiencing a phenomenal 134 percent surge from Rs 32.35. This surge has propelled the company's market capitalization closer to the Rs 1 trillion mark. Currently boasting a market cap of Rs 94,681 crore, IRFC ranks 61st in overall market capitalization. Notably, the company's market cap reached Rs 98,954 crore during intra-day trading on the same day.

Bright Outlook for IRFC:

IRFC's outlook for FY 23-24 centres on strengthening its robust business model and nurturing a strong relationship with the Ministry of Railways (MoR). Over the years, the company has witnessed substantial growth in its business with MoR, with cumulative funding for the railway sector exceeding Rs 5.50 trillion. Assets Under Management (AUM) have also reached Rs 4.66 trillion as of March 2023. In line with India's focus on infrastructure spending to achieve its target GDP of $5 trillion by FY25, IRFC is committed to raising funds from the financial market at competitive rates and terms.

National Infrastructure Pipeline and IRFC's Role:

The government's National Infrastructure Pipeline (NIP) and the PM Gatishakti initiative have laid the groundwork for comprehensive and integrated infrastructure development in India. On July 27, IRFC signed a Memorandum of Understanding (MoU) with RITES to enhance cooperation in financing and developing Railway Infrastructure Projects. This MoU aims to identify mutual areas of collaboration, allowing IRFC to provide financial assistance to projects and institutions with ties to railways.

MMTC's Remarkable Rally:

In parallel, shares of MMTC were locked in the upper circuit for the second consecutive day, soaring 20 percent to reach Rs 62.96 on the BSE. Trading volumes for MMTC also surged more than five-fold, with a combined 126 million shares changing hands on the NSE and BSE. Over the past three days, MMTC's stock has experienced a remarkable 50 percent increase from Rs 42.03.

MMTC's Statement on Trading Volume Surge:

Addressing the significant increase in trading volumes, MMTC clarified that there were no significant events within its knowledge that needed reporting to the exchanges. These events, the company affirmed, have had no bearing on the stock prices or trading volumes of its equity shares.

The soaring performance of PSUs IRFC and MMTC, with a 50 percent surge in just three days, reflects their resilience and appeal to investors. As the market continues to respond to these dramatic developments, the future holds exciting possibilities for these public sector undertakings in India.