Shares of railway-related companies, including IRCTC, RVNL, and Ircon International, saw significant gains on December 26, 2025, as the Indian government’s new railway fare hikes came into effect. The fare revision, which marks the second increase this year, has sparked positive momentum in rail stocks, with RVNL stocks climbing by as much as 11.77%, and IRCTC up 2.75%.
Details of the Fare Hike
The latest hike, effective from December 26, 2025, affects non-AC classes for ordinary and mail/express trains. Here are the key details of the revised fares:
- For ordinary non-AC services:
- No increase for journeys up to 215 km.
- ₹5 increase for distances between 216 km and 750 km.
- ₹10 increase for journeys between 751 km and 1250 km.
- ₹15 increase for distances between 1251 km and 1750 km.
- ₹20 increase for journeys between 1751 km and 2250 km.
- No increase for journeys up to 215 km.
- For mail/express trains, fares have been raised by 2 paise per km across both non-AC and AC classes, which includes sleeper class, first class, AC chair car, AC 3-tier, AC 2-tier, and AC first class. For example, a 500 km journey in a non-AC mail/express coach will see an additional charge of about ₹10.
Applicability of the New Fares
The new fare structure applies to all tickets booked on or after December 26, 2025. Tickets booked prior to this date will not incur the increased charges, even if the journey takes place after the effective date. The updated fare list will also be displayed at stations.
Major train services affected include Tejas Rajdhani, Rajdhani, Shatabdi, Duronto, Vande Bharat, Humsafar, Amrit Bharat, Tejas, Mahamana, Gatimaan, Antyodaya, Garib Rath, Jan Shatabdi, Yuva Express, Namo Bharat Rapid Rail, and ordinary non-suburban services.
Impact of the Fare Hike
This fare hike is designed to balance affordability for passengers while ensuring the sustainability of railway operations. The Railway Ministry has confirmed that the previous fare revision, implemented in July 2025, helped generate ₹700 crore in additional revenue.
Railway Stocks Surge
In the wake of the fare hike announcement, rail stocks have been performing well. Shares of RVNL, IRCTC, Ircon International, Titagarh Rail Systems, and BEML all saw significant upward movement. The sector has also been buzzing with anticipation regarding budget allocations for rail safety in the upcoming Union Budget for FY27, with reports suggesting a record ₹1.3 trillion may be allocated to rail safety measures, addressing concerns over accidents and slow implementation of protection systems.
Conclusion
As railway fares are revised, the immediate market response has been positive, with rail stocks seeing significant growth. The Indian Railways continues to play a pivotal role in the nation’s transport infrastructure, and these fare adjustments aim to ensure the sustainability of operations while providing essential services to millions of passengers every day.
