BackIRCTC stock jumps over 2.5% as Railway Board grants approval for seven-year tenders
Indian Railway Catering and Tourism Corporation (IRCTC) shares surge 2.65% as Ministry of Railways grants permission for long-term tenders.
PremiumIn Tuesday's trading session, Indian Railway Catering and Tourism Corporation (IRCTC) shares experienced a 2.65% surge, reaching ₹719.90 apiece. This boost followed the Ministry of Railways (Railway Board) granting approval to the company to engage in long-term tenders spanning 7 years (comprising an initial term of 5 years with the potential for an additional 2 years based on satisfactory performance) through clustering of trains.
However, in a regulatory filing made on Monday, IRCTC stated that it has been advised by the Ministry of Railways not to proceed with the initially proposed long-term tenders (5+5 years) for catering on trains for smooth implementation of YSA policy for providing passenger services on trains.
IRCTC is the only entity authorised by the Indian government to provide online railway tickets, catering services to railways, and packaged drinking water at railway stations and trains in India. The company has expanded its services over the years to include a wide range of tourism and hospitality offerings, such as luxury train tours, hotel bookings, and holiday packages.
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The stock made a strong debut on October 14, 2019, as it was listed at a premium of 127.7% at ₹728.6 apiece over the IPO price of ₹320. The stock has been trading on an ex-split basis with a 1:5 ratio since October 29, 2021.
Over the last six-month period, the stock has delivered a return of 16%. Looking at the long-term performance, the stock generated a fabulous return of 156% in the last three years, and it is up by 1006% in the last five-year period.
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In Q2FY24, the company reported a 30% improvement in its standalone net profit, reaching 294 crore. The revenue from operations in the second quarter of the current fiscal came in at ₹995.3 crore, registering a growth of 23.5% YoY.
The revenue from the company's catering segment witnessed a 29% increase to ₹431.5 crore in the September quarter, while the revenue from the internet ticketing segment jumped 9% to ₹327 crore.
The Indian government owns 62.4% of the shares in the company as of Q2FY24, while foreign portfolio investors and domestic institutional investors each own 7.1% and 10.5%, respectively. Regular shareholders own 20%, Trendlyne data showed.
At 01:00 PM, the stock was trading with a gain of 1.04% at ₹708.65 apiece.
Disclaimer: We advise investors to check with certified experts before taking any investment decisions.
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