IRFC, Mazagon Dock, Cochin Shipyard, CPCL jump 200-330% in last one year; is the rally in PSU space overdone?
Cochin Shipyard, Indian Railway Finance Corporation (IRFC), Rail Vikas Nigam (RVNL) and Mazagon Dock Shipbuilders defied weak market sentiment on Wednesday, jumping between 4-12 per cent in intraday trade. PSU stocks have been on a tear for the last one year. Data show that shares of IRFC have surged over 300 per cent while those of CPCL, REC, ITI and Power Finance Corporation have jumped between 230-270 per cent.
Shares of Ircon International, Cochin Shipyard, Gujarat State Finance, Mazagon Dock, MRPL and MSTC have gained over 200 per cent each over the last year. At least 32 stocks from the PSU space have clocked a sharp gain of over 100 per cent in the last one year. PSU stocks have been enjoying a dream run on a confluence of factors.
The surge in power stocks could be attributed to a strong increase in power demand amid a surge in economic activities. This has benefitted power sector financing companies and supply chain companies. Also Read: REC, PFC, Rail Vikas Nigam among 14 PSU stocks that rallied between 100% and 250% in CY23 PSUs dealing in the railways sector have jumped on significant order wins resulting from the ongoing transformation within the sector.
The defence sector stocks have been gaining primarily due to increased budget allocations, strong order wins, and the government's emphasis on boosting domestic procurement while reducing dependence on defence imports. Also Read: Outlook 2024: Bullish on PSU theme, IT sector may face headwinds, says Naveen Kulkarni of Axis Securities PMS The renewable energy sector has witnessed a significant upswing, propelled by India's ambitious goals for transitioning to sustainable energy sources, targeting 500 GW of non-fossil-based electricity capacity by 2030. The
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