IRCTC share prices surge 132% on stock market debut

Shares of IRCTC more than doubled on their listing debut on BSE and NSE. They rose as much as 132% to ₹743, as compared to issue price of ₹320, before ending at ₹728, up 127%. The IPO of IRCTC, which was open for subscription between September 30 and October, was subscribed a massive 112 times. The retail category was subscribed nearly 15 times while qualified institutional buyers (QIBs) segment got subscribed 109 times and non-institutional investors (NIIs) category 355 times.

"IRCTC listing today proved yet again that a high quality business with a clear runway for growth which leaves a lot on the table for investors is a sure shot success. IRCTC has today managed to replicate the success of Avenue Supermart in the primary market where we saw bidders showing appetite for the stock even after the stock doubling on Day-1 of listing," said S Ranganathan, head of research at LKP Securities.

The issue comprised an offer-for-sale of 2.01 crore shares of face value of ₹10 each. Many analysts had recommended subscribe to the IRCTC IPO and also pointed out to potential listing gains.

Before IRCTC, Avenue Supermarts Ltd., owned by billionaire Radhakishan Damani, more than doubled on listing in March 2017 after the company’s IPO got bids for 106 times the quantity offered.

Yes Securities (India), SBI Capital Markets and IDBI Capital Markets were the merchant bankers of the IRCTC issue while Alankit Assignments was the registrar. The share allotment happened on October 10. The government mopped up nearly ₹650 crore from the sale of shares of IRCTC and its stake is now down to 87.4%.

IRCTC is the fourth railway company to be listed on the bourses after RITES, Rail Vikas Nigam and Ircon.

IRCTC reported a net profit of ₹272.6 crore in FY19, up from ₹220.6 crore in FY18. The company's revenue grew to ₹1,867 crore in FY19 from ₹1,470 crore in FY18.

IRCTC enjoys a monopoly in its business as it is the only entity authorised by Indian Railways to provide catering services to railways, online railway tickets and packaged drinking water at railway stations and trains in India. (With Agency Inputs)