Shares of the company involved in providing railway ticketing, catering, and tourism services surged by around 3 percent to Rs.956.8 per share after LIC increased its stake.
Share Price Movement
In Friday’s trading session, the Indian Railway Catering and Tourism Corporation Ltd (IRCTC) share price surged 2.7 percent to an intraday high of Rs.956.8 per share, up from its previous close of Rs.931.4 apiece. The price has since retreated and is currently trading at Rs.940.85 per share.
What happened
Life Insurance Corporation (LIC) announced on Thursday that it has increased its stake in Indian Railway Catering and Tourism Corporation (IRCTC) to approximately 9.3 percent.
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According to a regulatory filing, LIC’s holding in the railway sector ‘Miniratna’ PSU has risen by 2.02 percent from December 16, 2022, to September 11, 2024, through open market purchases.
Specifically, LIC’s shareholding in IRCTC has increased from 5,82,22,948 shares, representing 7.278 percent of the paid-up capital, to 7,43,79,924 shares, which corresponds to 9.298 percent of the company’s capital.
Business Segments
IRCTC operates in three main areas: catering services, e-ticketing, and tourism. It offers onboard catering, food services at railway stations, and e-catering for passengers.
As the exclusive platform for online Indian Railways ticket bookings, it handles millions of reservations daily. Its tourism services include travel packages for leisure, adventure, and pilgrimage, as well as hotel bookings and related services.
Future Outlook
IRCTC’s plans include expanding its hospitality offerings by developing budget hotels in key locations and entering an e-marketplace for services like bill payments and online insurance.
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The company aims to diversify into helicopter travel, medical tourism and enhanced e-catering services. Additionally, IRCTC plans to leverage technology, including AI and machine learning, to improve customer service and operational efficiency.
Shareholding Pattern
As of June 2024, the shareholding pattern for IRCTC Limited shows that promoters hold 62.04 percent of the shares, entirely held by the President of India. Foreign Institutional Investors (FII) hold 7.78 percent, Domestic Institutional Investors (DII) hold 13.74 percent, and Retail investors hold 16.06 percent.
Financial Performance
In its recent financial update, IRCTC Ltd reported net sales of Rs.1,120 crore for Q1 FY25, marking a 12 percent increase from Rs.1,002 crore in the same quarter last year. The company’s net profit for the quarter was Rs.308 crore, up from Rs.232 crore in Q1 FY24, reflecting a 33 percent increase.
Company Overview
Indian Railway Catering and Tourism Corporation (IRCTC) is the sole authorized entity for online railway ticketing, catering services, and packaged drinking water in India. Established in 1999, it offers a range of services including e-catering, travel packages, and hospitality solutions, making it a key player in India’s travel and tourism sector.
Written by – Siddesh S Raskar
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