Titagarh Rail Systems Enters Wagon Leasing Market: A Strategic Shift in Rail Logistics

Titagarh Rail Systems Ltd is entering the wagon leasing business to increase its market share in the private sector. The company plans to operate through its balance sheet or an SPV, aiming to capture a market of 1,500-2,000 leased wagons annually and diversify its revenue streams.

Titagarh Rail Systems Ltd is making a bold move into the wagon leasing business, aiming to capture a larger share of the private sector market. The company plans to offer long-term lease models, a strategic shift that could redefine its business operations.

The firm is already progressing in securing the necessary licenses for this venture. They are considering structuring the move either through their own balance sheet or by creating a special purpose vehicle (SPV). Notably, Vice Chairman and Managing Director Umesh Chowdhary clarified that since wagon leasing falls under operational leasing, an NBFC license is not needed.

This venture aims to target a lucrative market of 1,500-2,000 wagons annually. The private sector's growing preference for operational leases over capital expenditure is a driving factor. Recent policy discussions suggest wagon leasing companies might be able to maintain their own wagons, amplifying Titagarh Rail's revenue diversification and market penetration strategy.

(With inputs from agencies.)