Life Insurance Corporation in India has increased its stake in the monopoly company, Indian Railway Catering and Tourism Corporation (IRCTC). The insurance giant now holds a 7.278% stake in the company from its previous 5.005% as it bought an additional 1,81,80,323 shares taking its total holding to 5,82,22,948 Equity Shares.
The shares of IRCTC were trading 1 percent lower till Tuesday afternoon at Rs 669 levels. In the past five days, the shares have shed approximately 8 percent. The reason could be the recent announcement by the government to divest a 5% stake in IRCTC for Rs 680 per share via an Offer for Sale (OFS).
Unlike other Railway stocks that have rallied significantly this year, the shares of the monopoly company have shed approximately 21 percent on a YTD. The shares nose dived significantly after the company posted a marginal decline in quarterly results.
In Q2FY23, their total revenue stood at Rs805.8 Crore which declined by more than 5 percent Quarter on Quarter (QoQ) from Rs 852.59 Crore. Their net profit in the period stood at Rs 226.03 Crore which dropped from Rs 245.52 Crore in the previous quarter.
Indian Railway Catering and Tourism Corporation is a Mini Ratna central public sector enterprise and is a wholly owned subsidiary of Indian Railways, Government of India. It provides ticketing, catering, and tourism services for the Indian Railways.
The company has a market capitalization of Rs 53,584 Crore and a dividend yield of 0.52%. In addition to this, the stock is trading at a higher valuation as the TTM PE of IRCTC is 59.91 which is higher than the Sector PE of 83.18.
Written by Anoushka Roy
Disclaimer
The content in this news article is not investment advice. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
