Shares of Indian Railway Catering and Tourism Corporation (IRCTC) were trading higher for the seventh straight day, up 10 per cent to Rs 1,328 on the BSE on Saturday. The stock has rallied 17 per cent in the past two trading days.
IRCTC, the government-owned travel support services company, was trading at its highest level since market debut on October 10, 2019. The stock has zoomed 106 per cent against its listing price of Rs 644 on the BSE. Further, it has skyrocketed 315 per cent against its issue price of Rs 320 per share.
The trading volumes on the counter more than doubled with a combined 3.66 million shares changing hands on the NSE and BSE till 10:42 am.
Institutional investors have hiked their holdings in IRCTC by 176 basis points to 7.1 per cent since its listing. Their stake in the company increased from 5.34 per cent to 7.1 per cent at the end of December 2019 quarter.
IRCTC is the only entity authorized by the Indian Railways to provide catering services to railways, online railway tickets and packaged drinking water at railway stations and trains in India. It has a dominant position in online rail bookings/packaged drinking water with around 73 per cent/45 per cent market share, respectively.
According to CRISIL, online rail bookings are expected to grow at approximately 8 per cent compound annual growth rate (CAGR) to reach approximately 425-435 million in FY24, with e-booking penetration rising approximately 81 – 83 per cent during the same period.
Based on various parameters like high entry barrier business, strong earnings profile, diversified business segment, healthy return ratio, debt free status, and most importantly monopoly business, analysts have a positive view on the company.
A meeting of the board of directors of IRCTC is scheduled to be held on Wednesday, February 12, 2020, to consider, approve and take on record the unaudited financial results of the company for the quarter and nine months ended on December 31, 2019. The board will also consider to declare interim dividend, if any, and to fix the record date for the purpose of payment of dividend.