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SMEs Power India's Rail Boom
20 Sep
Summary
- Three SMEs supplying railway components stood out.
- Companies manufacture safety castings, engineered parts, and containers.
- Investment opportunity in India's growing railway infrastructure.
Small and medium-sized enterprises (SMEs) are integral to India's expanding railway supply chain, producing critical components beyond just coaches and locomotives.
Neetu Yoshi, incorporated in January 2020, manufactures customized ferrous metallurgical products, including safety-critical castings for railway wagons and coaches. Recent approvals suggest potential expansion into manufacturing complete bogies and couplers.
Gallard Steel, established in 2015, specializes in engineered steel castings for traction motors and bogie assemblies, contributing significantly to its revenue. The company is scaling its production capacity and developing new products for locomotives, with a substantial IPO prospectus filed on November 26, 2025.
Kalyani Cast-Tech, founded in 2012, produces castings and specialized cargo containers for industrial goods like steel coils and automobiles. Its new container production facility at the Kutch campus commenced operations after FY26, with a trial train reaching a newly commissioned cargo terminal in August 2026.
These SMEs demonstrate growth, strong returns on capital, and manageable debt, offering investors exposure to different facets of the railway sector. However, potential investors must consider SME-specific risks such as limited liquidity and half-yearly financial reporting, alongside ongoing execution challenges for new facilities and order volumes.
