Transport

Rolling stock

The trains themselves, owned not by the operators that run them but by leasing companies. A ROSCO (rolling-stock leasing company) buys the fleet and leases each unit, often fully maintained, to a train operator for a lease rate on every available train, for decades. The same model appears as an availability PPP, where a government pays for trains kept fit for service. Pick a real lessor below and work through the depot, the model and a working returns model.

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In focus · —
Example

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Drag the sliders to see what earns the money: the size of the fleet, the lease rate on each unit, and how much of it is available for service. How many passengers ride is beside the point.

320 units
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Fleet
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In service
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Lease revenue
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recurring revenue p.a.
EBITDA p.a.
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01

What it is & how it works

02

How it earns

Model A · the leasing annuity

A lease rate on every available train

Rolling stock is the asset layer of rail, the trains and railcars themselves, owned not by the operators that run them but by a leasing company. The business is a contracted leasing annuity: the lessor buys the fleet once, then earns a lease rate per unit per year, paid for so long as each unit is available for service, over an asset that lasts 30-40 years. There are two flavours. An operating lease (a classic ROSCO like Angel Trains, or a railcar lessor like GATX) leases the fleet at market rates and carries the residual-value risk (what the trains are worth and re-leasable for when the first lease ends), which makes it a little more cyclical and a little higher-returning. An availability PPP (Lima, Sydney, Riyadh) is the same model with the risk stripped out: a government pays a contracted, indexed payment for trains kept fit for service, with no demand risk and no residual exposure: a pure, core-infrastructure annuity. A finance lease (CRRC) goes further still, leaving maintenance with the lessee for a thin, high-margin financing spread. Everything turns on the fleet, the lease rate and the availability rather than on the passengers.

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03

What it costs, and how it's financed

Revenue → operating costs → EBITDAMargin —

The capital · the fleet
Who funds the fleetallocation

    History & framework · key milestones
      04

      Cash flows & returns

      Fleet & contributions

      m
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      Revenue regime & tax

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      Financing & hold

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      y
      Unlevered IRR
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      asset / project return
      Levered IRR
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      return to equity
      Equity multiple
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      MOIC over hold
      Payback
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      project, undiscounted
      Cash-flow profile, equity■ invested   ■ returned
      Show the year-by-year schedule
      05

      What drives the return

        See also the rolling-stock simulator, and the Cash-flow & DCF model.