Over 6,000% gain in 5 years! This multibagger railway stock hits 5% upper circuit for the 2nd day. Here’s why

Multibagger stock: Shares of Kernex Microsystems India, which manufactures and sells Safety Systems and Software services for Railways, were locked in the 5% upper circuit for the second consecutive trading session on Wednesday, April 02, reaching ₹855.55 apiece after the company secured a Kavach order.

On Tuesday, the company informed investors through an exchange filing that a consortium including Kernex secured an order from North Central Railways for a Kavach project worth ₹85 crore.

"We would like to inform you that 'North Central Railways, Prayagraj' has issued a Letter of Acceptance (LOA) to the KERNEX-KEC CONSORTIUM for the project involving the provision of Kavach (Train Collision Avoidance System), along with Tower and 4X48 fiber OFC as a backbone on the Shuteshwar (Incl.)–Dholpur (Incl.) section in North Central Railway (Tender No. NCR-SnTEPCKAVACHBTSR-DHO)," the company said in its Tuesday filing.

This latest order builds on the company’s earlier project in late February, when it secured an order worth ₹325.33 crore for the supply, installation, testing, and commissioning of the Train Collision Avoidance System (Kavach) for train sets from South Eastern Railways.

The company has been securing large Kavach orders as the Indian government prioritizes railway safety. Kavach, also known as the Train Collision Avoidance System (TCAS) or Automatic Train Protection System (IRATPS), is an advanced safety solution designed to prevent train collisions and improve operational safety.

India's Kavach, an Automatic Train Protection (ATP) system launched in 2020, has been enhancing rail safety through technology that automatically applies brakes when a loco pilot fails to act. In December, the company secured a significant order worth ₹2,041 crore from Chittaranjan Locomotive Works, a unit of the Ministry of Railways, Government of India.

Stock advances 6,000% in 5 years

The stock witnessed profit booking after reaching a fresh peak of ₹1,584 apiece in December. However, it regained momentum in the current month. Despite a steep 45% decline from its recent peak, the stock is still trading 250% higher over the last two years, 471% higher over the past three years, and 6,243% higher over five years.

Between February 2021 and December 2024, the stock experienced a one-way rally, surging from ₹29 apiece to ₹1,584, delivering a massive 5,362% return to its shareholders.

About the Company

Kernex Microsystems is engaged in the manufacturing and sale of safety systems and anti-collision devices for railways, along with software services.

The company began its journey in railway safety systems in 1999, successfully developing and demonstrating a prototype of Anti-Collision Devices (ACDs) to the Konkan Railway Corporation Limited and members of the Railway Safety Board, according to the company’s website.

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