Shares of Siemens rose nearly 4% in opening trade on Tuesday after the industrial manufacturing company announced that it has bagged its single largest order till date. The company has secured an order worth ₹26,000 crore from Indian Railways to deliver 1,200 locomotives of 9,000 horsepower (HP) and provide 35 years of full service maintenance.

Buoyed by strong order, shares of Siemens opened 2.9% higher at ₹3,030 against the previous closing price of ₹2,943.60 on the BSE. The largecap stock gained as much as 3.7% to ₹3,051.80, while the market capitalisation surged to ₹1.06 lakh crore. In comparison, the BSE Sensex rose 228 points to 60,321 levels.

Siemens share price currently trades 3.5% lower than its all-time high of ₹3,136.80 touched on September 15, 2022. The stock hit its 52-week low of ₹2,150.75 on May 9, 2022. The counter has risen 25% in a year, while it has added 10% in the past six months. The share of the technology company has climbed 1% in a month and 4% in a week.    

In a post market hour release on Monday, the company, a subsidiary of Germany-based Siemens AG, said that it has won the single largest locomotive order in the history of Siemens Mobility and the single largest order in the history of Siemens in India.

“Siemens Limited will design, manufacture, commission and test the locomotives. Deliveries are planned over an eleven-year period, and the contract includes 35 years of full service maintenance,” it said in a BSE filing.

As per the release, the locomotives will be assembled in the Indian Railways factory in Dahod, Gujarat, while maintenance will be performed in four Indian Railways depots located in Vishakhapatnam, Raipur, Kharagpur, and Pune.

“Locomotive assembly and maintenance will be implemented together with the staff of Indian Railways. The contract has a total value of ₹26,000 crore (approximately), excluding taxes and price variation,” it said.

The locomotives will be used for freight transport throughout the Indian Railways network and are specified to haul loads of 4,500 tons at a maximum speed of 120 km per hour. Producing 9,000 HP, the locomotives will be one of the most powerful freight locomotives in the world. They will be equipped with advanced propulsion systems that are also produced locally in Siemens factories in India as well as the Railigent platform to deliver high levels of availability and performance, the company said.

"Siemens is supporting the sustainable transformation of India’s transportation sector as the country seeks to almost double freight capacity on its railways," said Siemens CEO Roland Busch. "I’m proud that this major order will help India achieve its ambitious goal of creating the world’s largest green rail network, as our locomotives will save more than 800 million tons of CO2 emissions over their lifecycle."

Sunil Mathur, Managing Director and Chief Executive Officer, Siemens Limited, said the 9,000 HP electric locomotive is a significant milestone in the rail electrification mission of Indian Railways, which will be built in India using the latest technology provided by Siemens Mobility. This is another step in Siemens strategy of continued localisation under the ‘Make in India’ vision of the government, to provide integrated, cost effective and sustainable offerings to meet the nation’s freight and passenger transportation demands, he added.

India has one of the world’s largest rail transport and logistics networks used daily by 2.4 crore passengers on more than 22,000 trains. Additionally, the government of India plans to increase the share of railways in freight to 40-45% from the current 27%. India is one of the few countries in the world with an almost fully-electrified rail network.

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