Indian Railways is rapidly implementing the indigenous ‘Kavach’ system to make the journey of passengers completely safe. This is an automatic train protection system, which automatically stops the train if the driver misses the signal or the speed exceeds the prescribed speed. Due to this big security project, the movement in the stock market has also increased.
According to market experts, this entire Kavach project of Railways has brought a big business opportunity of about ₹ 50,000 crore. This project is expected to directly benefit the three major companies associated with the railway sector, Kernex Microsystems, Concord Control Systems and HBL Engineering, whose order book looks quite strong at the moment.
Security circle of Indian Railways, rapidly expanding scope
To prevent railway accidents in the country, the government’s entire focus is currently on the armor system. By March 2026, this state-of-the-art safety system has been successfully implemented on 3,103 route kilometers. Apart from this, its work on 24,427 route kilometers in different parts of the country is progressing very fast. The government plans to add a new network of 9,000 route kilometers within the next two years. This major preparation by the Railways has opened up long avenues of earning for the companies in the signaling and safety sector.
1- Kernex Microsystems
Cernex Microsystems mainly works in the field of railway safety and software solutions. The most important product of the company is ‘Kavach 4.0’. Talking about production capacity, the company has the capacity to produce 450 armor units every month. In March 2026, the company has also formed a joint venture with BHEL to further accelerate this work.
As of May 29, 2026, the company had a strong order book of ₹4,150 crore, which assures long-term earnings of about 10 years depending on its financial year 2026 (FY26) revenue. In the financial year 2026, the company’s revenue increased by a huge 127% to reach ₹ 430 crore, while the operating profit was recorded at ₹ 149 crore. However, due to this fast pace of orders, some pressure is being seen on the working capital of the company.
2- Concord Control Systems
Concorde Control Systems manufactures many important components along with the technology required for Kavach 4.0. The company has received prototype approval from the Research Design and Standards Organization (RDSO), after which its field trials have also started.
As of March 31, 2026, the company had an order book of ₹697 crore. Soon after, the company received a new Kavach order worth ₹279.9 crore in May 2026. The special thing is that after the completion of these orders, the company will continue to earn continuously from maintenance for the next 15 years. The company’s performance was excellent in the financial year 2026, where its revenue increased by 69% to ₹ 210.5 crore and net profit increased by 88% to ₹ 42.7 crore.
3- HBL Engineering
HBL Engineering is considered to be the earliest and most experienced player in armor technology, which has been working on this safety technology since 2005. It has become the first company in the country to achieve the certification of ‘Kavach 4.0’.
As of June 22, 2026, the company had a huge order book of ₹ 5,748 crore. According to the company’s internal estimates, it expects annual sales of ₹1,300 crore to ₹1,500 crore from the Kavach project alone between financial years 2026 to 2028. Apart from this, the company is also focusing on train management system and other railway signaling products.
Disclaimer: This article is for information only and should not be considered as investment advice in any way. TV9 Bharatvarsha advises its readers and viewers to consult their financial advisors before taking any money-related decisions.
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