High valuations may cap further rally in IRCTC stock despite good revenue

At trailing PE of 65x it seems to fully discount future growth and visibility of good revenue streams

Investor interest in IRCTC (Indian Railway Catering and Tourism Corporation) has grown after the recent announcement that the PSU is expanding into non-railway catering and focusing on branding to become a premium hospitality brand.

The company has also declared good results. In the July-September quarter (Q2FY24), IRCTC delivered 30 per cent year-on-year (Y-o-Y) growth in PAT (profit after tax) with higher revenues in ticketing business and better margins in the catering business.

Ancillary revenue from payment gateway, ads, revenue share from the online travel agency also grew 7 per cent Y-o-Y, reversing a declining trend in the prior