Mumbai: Shares of rail related companies like IRCTC, RVNL, and Ircon International saw strong gains on Friday, December 26, as train fares hike announced by the government came into effect. Rail Vikas Nigam (RVNL) shares climbed nearly 12 percent to Rs 386.40, IRCTC rose 2.75 percent to Rs 698.35, and Ircon International gained over 8 percent to Rs 184.72. Other companies like RITES, Titagarh Rail Systems, BEML, and Jupiter Wagons also saw increases ranging from 2 percent to 5 percent.
Why the Fare Hike Was Introduced?
This is the second fare revision in 2025, the first being in July. The Railway Ministry explained that the fare adjustments aim to balance affordability for passengers with the sustainability of railway operations. The increase is structured gradually across different classes to avoid sudden impacts on commuters, especially short-distance travelers.
Details of the New Fare Structure
For ordinary non-AC services, second class fares remain unchanged for journeys up to 215 km. For longer trips, fares rise gradually: Rs 5 for 216–750 km, Rs 10 for 751–1250 km, Rs 15 for 1251–1750 km, and Rs 20 for 1751–2250 km. Sleeper and first class ordinary fares have been revised at 1 paise per km, while mail and express trains, including AC and non-AC coaches, see an increase of 2 paise per km. For example, a 500 km journey in a non-AC express coach costs about Rs 10 more. Suburban services and season tickets remain unaffected.
Where the Fare Hike Applies?
The revised fares apply to tickets booked on or after December 26, 2025. Popular trains like Tejas, Rajdhani, Shatabdi, Vande Bharat, Duronto, Humsafar, and others are included. Tickets booked earlier are not affected. Station fare lists have been updated to reflect the changes.
Market and Budget Implications
The July fare hike generated Rs 700 crore. Rail stocks have been active due to expectations of increased government investment in the sector. The Union Budget 2026-27 may allocate Rs 1.3 trillion for rail safety, nearly half of Indian Railways capital expenditure, addressing accident concerns and slow safety system rollouts.
Disclaimer: This content is for informational purposes only and does not constitute financial advice. Investors should conduct their own research or consult a professional before making any investment or trading decisions.
