IRCTC jumps nearly 3% as Railway Board approves long-term tenders
What's the story
Shares of the Indian Railway Catering and Tourism Corporation (IRCTC) saw a 2.72% jump during Tuesday's trading session, reaching Rs. 720.30 each on BSE.
This rise came after the Ministry of Railways (Railway Board) approved the company's involvement in long-term tenders lasting seven years through train clustering.
However, the Ministry advised IRCTC not to pursue the originally proposed long-term tenders (5+5 years) for train catering to ensure a smooth implementation of the YSA policy for providing passenger services on trains.
Details
IRCTC's exclusive services and expansion
IRCTC holds exclusive authorization from the Indian government to offer online railway tickets, railway catering services, and packaged drinking water at train stations and on trains throughout India.
The company has broadened its scope over time, now providing various tourism and hospitality services such as luxury train tours, hotel reservations, and vacation packages.
What Next?
IRCTC stock gave over 355% return since listing
In the past six months, IRCTC's stock has yielded a return of 16%.
Regarding long-term performance, the stock has produced an impressive return of 355% since its listing in October 2019.
In Q2 FY24, the company announced a 30% growth in its standalone net profit, amounting to Rs. 294 crore.
The revenue from operations during the second quarter of the current fiscal year reached Rs. 995.3 crore, marking a 23.5% YoY growth.
Insights
Revenue growth in catering and internet ticketing segments
During the September quarter, IRCTC's catering segment experienced a 29% revenue growth, reaching Rs. 431.5 crore, while the internet ticketing segment saw a 9% increase to Rs. 327 crore.
As of Q2 FY24, the Indian government holds 62.4% of the company's shares, with foreign portfolio investors and domestic institutional investors owning 7.1% and 10.5%, respectively.
At the time of writing, the stock was trading with a gain of 1.21% at Rs. 709.65 per share on the BSE.