Jefferies reiterates a buy rating on Titagarh Rail Systems, setting a target price of ₹990, citing strong passenger rail demand and a robust order backlog despite softer wagon sales, signalling potential for significant upside.
Jefferies has reiterated a buy call on Titagarh Rail Systems, setting a target price of ₹990 a share and implying an upside of about 20.6% from the stock’s recent closing level of ₹821. The brokerage’s latest view comes as the Kolkata-based rail equipment maker continues to benefit from demand in passenger mobility, even as wagon sales have softened.
According to the Trade Brains summary of Jefferies’ note, the firm said Titagarh’s first-quarter EBITDA came in about 5% ahead of expectations, helped by stronger-than-expected margins in passenger rail. Passenger coach sales rose for a sixth straight quarter, while Jefferies kept its FY27 guide of 200 to 220 metro coaches. It also expects wagon sales to fall 12% this year, but said the company’s passenger order pipeline gives it visibility beyond FY28.
The company’s order book remains substantial. Trade Brains reported backlog of roughly ₹13,335 crore, including its wholly owned subsidiary, with passenger rail contributing about ₹10,395 crore and freight rail around ₹2,470 crore. Jefferies has also pointed to joint venture work that lifts the broader order base, while Sahi.com said Titagarh is targeting 200 passenger cars in FY27 and has metro orders booked through FY28.
That optimism is broadly in line with Street estimates. Investing.com, citing eight analysts polled by S&P Global, said Titagarh carries a consensus strong buy rating and an average target of ₹995, just above Jefferies’ latest call. The Economic Times also reported that Jefferies recently lifted its target after a stronger quarter and better execution, as the company positions itself more heavily towards higher-margin passenger rail work.
Titagarh Rail Systems makes freight wagons, passenger coaches, metro trains and propulsion systems, and has also been building out maintenance and component capabilities. Trade Brains reported that revenue rose 12.7% year on year to ₹765 crore in the latest quarter, while net profit climbed nearly 71% to ₹53 crore. Return on capital employed stood at 10.6% and return on equity at 6.47%, with debt-to-equity at 0.25 times, underscoring a balance sheet that remains relatively conservative for a capital-intensive manufacturer.
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