Jefferies has initiated coverage on railway stocks Titagarh and Jupiter Wagons, with 'Buy' and 'Underperform' ratings, respectively. AI Quick ReadStocks to buy or sell: Global brokerage Jefferies sees strong growth in the Indian Railways' rolling stock capex, but finds one stock worthy to capitalise on this trend: Titagarh Rail Systems.
Jefferies has initiated coverage on railway stocks Titagarh and Jupiter Wagons, with 'Buy' and 'Underperform' ratings, respectively. While both stocks trade at 40 times price to earnings (PE), the brokerage finds Jupiter Wagons too expensive for the growth differential. It has a target price of ₹810 for Titagarh, suggesting a 32% upside from the last closing price of ₹615, while for Jupiter Wagons, the global brokerage sees a 22% decline.
Jefferies remains bullish on railway rolling stocks as it sees a 10% FY26-30E CAGR in sectoral spending, led by a 16% CAGR in passenger coach spending, vs 7% in FY20-26E, with a focus on safety, modernization, and Vande Bharat trainsets; and a 9% CAGR in locomotive spending, led by heavy haul for new freight corridors, offset by 5% CAGR in wagon spending vs 14% in FY20-26E.
The brokerage added that new high-speed rail (HSR) corridors provide growth visibility beyond FY30E as domestic trains can be 25-30% cheaper to procure. However, potential Vande Bharat trainset exports are an upside risk.
Additionally, India’s Metro rail network is expected to aid demand. The metro network expanded 4x in FY14-25 to ~1,000 km. Jefferies said it could double to 2,000 km by FY33E, driven by urbanisation and a strong project pipeline. "We see a 9% FY26-30 CAGR in Metro coach investments, similar to FY20-26E."
Against this backdrop, the brokerage said Titagarh will be a key beneficiary of rising passenger and metro coach demand.
Jefferies estimates 35% revenue and a 43% EPS CAGR in FY26-30 led by 14x rise in its passenger segment revenues over FY26E-30E, with a strong order book lending visibility, and ~1.4ppt margin improvement in the passenger segment as it moves up the technology value chain.
"We expect RoE to double from 6% in FY26E to 13% by FY28E and 16% by FY30E, led by rising plant utilisation. Our ₹810 PT values Titagarh’s core business at 25x Mar’28E EPS and the upcoming wheel JV at 2.5x investment value. We believe valuation multiples are justified relative to those of industrial companies with similar EPS growth," it opined.
Among the key risks are limited wagon business visibility post-exhaustion of the current order book, weak execution and entry of Chinese players into passenger coaches.
Shares of Titagarh Rail Systems ended 19% down in 2025, snapping their 5-year winning run. So far in 2026, the railway stock is down 28%, recording losses in the first three months of the year.
As for Jupiter Wagons, Jefferies estimates a 23% FY25-30E EPS CAGR for Jupiter as against 43% CAGR for Titagarh, given its higher exposure to wagons.
"With valuations at 40x FY27E PE, similar to Titagarh, we find Jupiter too expensive for the growth differential. Our ₹200 PT values JWL's core business (ex-Wheel) at 20x Mar'28E EPS and its wheel manufacturing JV at 3.5x P/BV," the global brokerage said.
Like Titagarh, Jupiter Wagons, too, recorded its first annual loss in six years in 2025 as it ended 2025 with a 32% loss. In the first few months of 2026, it is already down 24%.
Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
Saloni Goel has over nine years of experience as a business journalist, with a strong track record of covering the financial markets. Over the course of her career, she has reported extensively on global and domestic equities, IPO market activity, commodities, and broader macroeconomic trends. Her reporting reflects a keen eye for detail, data-driven analysis, and the ability to spot emerging themes early.<br>
At Mint, Saloni has been part of the markets team for nearly two years, where she currently works as Chief Content Producer. In this role, she plays a key part in shaping market coverage, driving editorial strategy, and ensuring timely, accurate, and insightful reporting across. She has been closely involved in breaking news coverage and in crafting stories that help decode the complex financial developments.<br>
Before joining Mint, Saloni worked with some of India’s leading business newsrooms, including The Economic Times and Business Standard. Throughout her career, she has worn multiple hats—ranging from reporting and editing to contributing in-depth features and identifying new storytelling formats and market trends.<br>
Her experience in fast-paced digital newsrooms has given her an edge in simplifying complex market concepts without losing analytical depth. Outside of work, Saloni enjoys reading books and spending time with her pet.