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RAILWAY BUDGET
SPECIAL
Turnaround
Express going strong
Indian Railways (IR) could be one of
the best Indian turnaround stories of recent times. Last
year in our special report on Union Railway Budget, we
had told you how after coming very close to a financial
crunch the loss-making national carrier managed to turn
around its operations. The good news is IR continues to
impress us with its performance. Thanks to the buoyancy
in the freight rates, euphoric growth in the gross
domestic product (GDP) and steady rise in passenger
traffic, the total traffic receipts of the IR are
expected to have grown by 15.5% in FY2006 and are
estimated to grow at 9.6% in FY2007. With the leverage
effect coming into play, the top line of IR too is
growing at a good pace, leading to strong operating cash
flows and higher capital expenditure (capex).
The man who is responsible for the
magical transformation of IR, Union Railways Minister
Lalu Prasad Yadav, is all set to present his fourth
Union Railway Budget on February 26. The event is keenly
awaited by the stock market since any proposal to
increase IR's capex in the forthcoming railway budget
would bode well for the capital goods companies. In this
report we shall tell you which companies stand to
benefit the most from a possible hike in IR's
capex. | 
