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Rail stock up 27% in 3 days, zooms 47% in 10 days; what's behind the rally?

In the past three days, the stock rallied 27 per cent after the company reported strong earnings for the quarter ended March 2025 SI Reporter Mumbai Kernex Microsystems India share price today: Share price of Kernex Microsystems India continued their upward movement, gaining 5 per cent to ₹1,148.75 on the BSE in Tuesday's intra-day trade in otherwise a weak market. The stock of railway railway-related company is quoting higher for the 10th straight trading day, rallying 45 per cent during the period. Thus far in the month of May, it zoomed 57 per cent. In the past three days, the stock rallied 27 per cent after the company reported strong earnings for the quarter ended March 2025 (Q4FY25). At 12:42 PM, Kernex Microsystems was up 3 per cent at ₹1,125.80, as compared to a 0.7 per cent decline in the BSE Sensex. The average trading volumes on the counter jumped over 10-fold. A combined 1.33 million equity shares representing 8 per cent of the total equity of Kernex Microsystems have changed hands on the NSE and BSE. What's behind the rally? On Friday, May 23, 2025, Kernex Microsystems India reported standalone profit after tax (PAT) at ₹7.14 crore, on the back of strong operational performance. The company had posted a loss of ₹3.5 crore in the year-ago quarter. Revenue from operations grew 329 per cent year-on-year (Y-o-Y) to ₹36.80 crore from ₹8.57 crore in Q4FY24. The company's total value of order book as on March 31, 2024, stood at ₹2,124.16 crore. Railway Sector The railway sector has experienced significant growth over the past few years, driven by increased investments and financial backing from the government. The National Rail Plan 2030 offers numerous opportunities across various railway domains. The Union Budget for FY 2025-26 included a record-breaking capital allocation of ₹2.65 trillion for the railways. The key areas targeted for investment are rolling stock, multitracking works, electrification, passenger amenities, high-speed rail and DFCs. The government is also exploring private investments in rolling stock manufacturing and operation, and maintenance services. The government's emphasis on modernising and expanding railway infrastructure is evident through several key initiatives. These include the introduction of High-Speed Rail (HSR) and semi-HSR corridors, RRTS, suburban rail systems, first and last-mile connectivity projects, station modernisation, enhanced implementation of the Automatic Train Protection System 'KAVACH,' and the deployment of LTE-R (Long Term Evolution for Railways), the engineering giant Larsen & Toubro (L&T) said in its financial year 2024-25 (FY25) annual report. Following directives from the Railway Board, zonal railways have gradually adopted the EPC delivery model. Building on the successful commissioning of the Dedicated Freight Corridor (DFC), some railway zones are in the process of transitioning to large-scale Engineering, Procurement, and Construction (EPC) packages instead of smaller contracts. The acceptance of advanced transport systems, such as the Regional Rapid Transit System (RRTS) and HSR, continues to grow, as demonstrated by the recent commissioning of the Delhi-Meerut RRTS corridor. Furthermore, there is a significant pipeline of projects across both the mainline and metro segments that are expected to be bid out in the near term, L&T said. ALSO READ: About Kernex Microsystems (India) Kernex Microsystems (India) is engaged in the manufacture and sale of Safety Systems and Software services for Railways with a plant location at Hyderabad and a branch in Cairo, Egypt. The Company has been instrumental in implementing Train Collision Avoidance System (TCAS) systems across the Indian Railways network. This extensive experience has solidified its position as a leading provider of rail safety solutions within the country. The Company is actively pursuing opportunities in Yard Management, where its TCAS systems are already being utilised. This involves managing and optimising the movement of trains and assets within railway yards, enhancing operational efficiency and safety.