Railway stocks tank 20% as election trends diverge from exit polls

Railway stocks tanked by up to 20% on Tuesday, June 4, as early election trends diverged from exit poll predictions.

Shares of Titagarh Rail Systems and RailTel Corporation tumbled nearly 20%, while Ircon International, IRCTC, RITES, Rail Vikas Nigam (RVNL), and Texmaco Rail & Engineering saw declines of over 18%. Meanwhile, IRFC and Jupiter Wagons also fell around 16%.

As per early data till 11:10 am, the BJP-led NDA was ahead in 289 seats out of 543 seats, while the INDIA alliance was leading in 233 seats, with others leading in 21 seats. This contrasts with earlier exit poll surveys, which, after the 7th phase of elections on Saturday, indicated a likely BJP victory with the NDA securing over 370 seats.

Attributing today's steep fall to the current trends, V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said that if the BJP doesn’t secure a majority on its own, there will be disappointment, which is being reflected in the market.

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Meanwhile, as of 11:01 am, the BSE Sensex was trading 3,307 points, or 4.3%, lower at 73,156. The Nifty50 was down 1,061 points, or 4.56%, trading at 22,202. The volatility gauge India VIX also spiked 33.8% to 28 levels.

The market capitalization of all listed companies on the BSE declined by Rs 21.5 lakh crore to Rs 404.42 lakh crore.

In Tuesday's trade, the Nifty PSU Bank index was the worst hit, crashing over 11% with all stocks in the index seeing double-digit losses. Other PSU stocks like PFC, REC, and BEL fell up to 20%.

(Disclaimer: The views expressed by experts are their own and do not necessarily reflect those of The Economic Times)