He also expressed a positive view on BEML, noting that while metro projects contribute only 30% to its revenue, it remains the fastest-growing segment. For long-term investment, Siemens is preferred.
Kapadia explained that Siemens’ mobility segment currently contributes around 15% to its revenue. While the company earlier focused mainly on component manufacturing and rail signalling systems in India, it has recently expanded into full metro coach manufacturing for the global market.
Also Read: Rail stocks — glass half full or half empty?
It has already secured orders for locomotives, with more tenders likely as Dedicated Freight Corridors near completion. Siemens is also investing in capital expenditure to strengthen its presence in the railway and metro segments.
RVNL has maintained a strong order book, although execution has been somewhat slow. However, he expects execution to improve this year as construction activity picks up across the railway sector, potentially leading to more orders.
Regarding Titagarh, he highlighted that it is the only railway company involved in all segments—from wagons to metro coaches to Vande Bharat manufacturing. With ongoing prototype development, additional orders are anticipated once the process is completed, strengthening the positive outlook for the company.
On valuation, Kapadia believes a fair multiple for these companies is in the range of 25 to 30 times, backed by strong growth momentum. With railway capital expenditure potentially crossing ₹3 lakh crore, there is considerable opportunity ahead.
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