Election Results: IRFC, RVNL, IRCTC fall over 6% on second consecutive day

Railway stocks continued to witness heavy sell-off on Wednesday with shares of many firms falling as much as 13% in early morning trade.

Most stocks pared some of the losses but still were trading in the red. Amongst public sector companies, shares of Indian Railway Finance Corp were trading 3% lower as of 9:45 a.m. while RVNL shares were trading 3.66% lower. Indian Renewable Energy Dev Agency lost nearly 4% in early trade while Railtel Corporation of India shares fell 6.65%.

However, private firms involved in railway works appeared to have been hit harder. Titagarh Rail Systems lost nearly 14% in early morning trade while Texmaco Rail & Engineering lost nearly 5%. Shares of Oriental Rail Infrastructure, too, were trading nearly 5% lower.

The heavy selling comes at a time when the BJP managed to win just 240 seats in stark contrast to what was predicted in the exit polls over the weekend. With the party losing the clear majority compared to the previous election, the markets appear to be disappointed in government-owned sectors which is reflected in the railways stocks performance.

Meanwhile, foreign institutional investors (FIIs) sold a record ₹12,436 crore in Indian equities on Tuesday. This is believed to be a record selling by FIIs. Prior to this, such a rampant sell-off was witnessed on January 17 when foreign investors sold ₹10,578 crore worth of equities in a single day on a net basis. So far in June, foreign investors have net sold equities worth ₹5,585 crore.

The benchmark Nifty and the Sensex lost gains recorded at the opening and are trading in the red at 9:55 a.m. The Nifty 50 is down 0.17% while the Sensex is trading 0.09% lower on Wednesday morning. The day will also see Bank Nifty expiry. However, participation in the options market declined on Tuesday, as was reflected in the open interest figures, due to a significant increase in volatility.