Government infra spending to revive wagon manufacturing

“The government’s capex push with a focus on infrastructure will boost the demand for rolling stock. Already, Indian Railways plans to keep the record level of wagon orders, while private container train operations are also expected to go ahead with the operation of parts of the dedicated freight corridor,” Gupta said in an interview.

Union Budget hikes capital expenditure by a record 35% for FY13 7.5 trillion, with most of the additional capital expenditure expected to go to infrastructure projects.

Gupta said there is a lot of traction for orders now and thus the order book position should improve for all companies in the space, including Texmaco.

According to the MD of Texmaco, a lot of work from railways, metro and other projects, including ballastless track and signalling, is also coming up in the engineering, procurement and construction (EPC) segment, where the company will actively participate.

Rolling stock accounts for about 40% of Texmaco’s total business, which was 1,689 crore in FY21. The other 40% contributes to EPC, while the remaining 20% ​​comes from its foundries and other small business verticals.

“Now, here again the focus will be on building the order book and participating in EPC tenders. A huge amount of work is being done for the EPC.”

The company has an order book of 1,400 wagons and is expected to increase substantially in FY23 on account of larger railway tenders. Also, the company is expected to get more orders from the private sector.

To expand its operations, Texmaco aims to increase its export and tap markets across the African continent.

Gupta said Texmaco is targeting Africa, where the company has already placed orders for 200 wagons in Liberia, Cameroon and Mozambique.