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News: Siemens has signed the single-largest Indian contract with Indian Railways worth Rs 26000 crore. The company received an order for 1,200 locomotives of 9000 horsepower (HP) from Indian Railways. Siemens will design, manufacture, commission and test the locomotives. Deliveries are planned over an 11-year period while the contract includes 35 years of full-service maintenance
Views: Earlier Siemens had received the LoA from the Ministry of Railways for this project. National Rail plan to raise the share of Railways in freight gradually to 40-45% from the current 27%. As Railways is improving the infrastructure, steam locomotives are being upgraded to electric locomotives. Hence, the opportunity is quite big for electric locomotives, going forward, and will benefit companies like Siemens. Siemens reported order inflows for FY22 (September ending) of Rs 19640 crore, which grew 38% YoY with current order backlog of Rs 17183 crores 1.1x of FY22 revenue
Impact: Positive