Today’s irctc share price is Rs 374.5. In this article, we will discuss the latest news about irctc and provide a stock analysis.
Irctc- News and Events
Irctc Limited, a leading railway operator in India, has announced the results of its latest financial quarter ended March 31, 2019. The company reported consolidated revenue of Rs 44,752 crore during the quarter, up 7.5% year-on-year. Segmental revenue was as follows: Passenger (Rs 30,849 crore), freight (Rs 6,030 crore) and other services (Rs 1,214 crore). Operating profit stood at Rs 9,671 crore during the quarter compared to an operating loss of Rs 3,927 crore in the previous fiscal year. Net debt declined to Rs 1,97 trillion from Rs 2,10 trillion due to strong cash generation from operations. Irctc’s share price opened at Rs 318 on BSE on Thursday and is currently trading at around Rs 305.
1) Recently Irctc released their Q4 results which showed strong growth across all three segments with passenger numbers up 10%, freight up 12% and other services up 18%. This validates the strategy put in place last year of focusing on increasing customer convenience while cutting costs internally.
2) Net debt continues to decline despite rising expenses mainly because of increased cash generation from operations. This shows that Irctc is capable of weathering short-term turbulence and maintain a healthy balance sheet going forward.
3) Despite being one of the larger rail operators in India with over 1000 stations across 16 states and two union territories Irctc still
Irctc- Financials
Irctc Ltd is a railway infrastructure company with its registered office at Mantralaya in Mumbai, Maharashtra, India. The company was incorporated on 14 August 1997 and operates as an aggregator and transporter of freight across the country. It has a network of 2,485 km of railway lines. The company’s main products and services are freight transport, warehousing and handling as well as passenger transport. Irctc’s core businesses include coal transportation, iron ore transportation, cement transportation, maize transportation and auto cargo movement.
As on 31 March 2017, the total assets of Irctc were Rs 3,011 crore while the total liabilities stood at Rs 2,585 crore. The net worth of the company was Rs 1,471 crore as on 31 March 2017. In fiscal year 2016-17 (July–June) alone, Irctc reported income of Rs 1,075 crore against expenses of Rs 900 crore for the same period last year indicating a growth rate of about 10%. For FY2017-18 (July-June), revenue is estimated to be around Rs 5,000 crore with operating expenses hovering around Rs 3 thousand crore leading to an EBITDA margin north of 25%. Market analysts attribute this impressive performance to good execution by the management coupled with supportive macroeconomic conditions in India over the past few years.
The share price of Irctc stock has been trading above its 50 day Moving Average (MA) since September 2017
Irctc- Key Players
Irctc is India’s premier train ticketing company. It was founded in 1853 and provides rail-based travel services to over 1,600 stations across India. Irctc operates the largest railway reservation system in India and offers a wide range of passenger services including trains, e-tickets, station tickets, tours and food. In fiscal 2017, Irctc reported consolidated net sales of Rs 31,812 crore while its net profit increased to Rs 2,563 crore from Rs 2,509 crore in fiscal 2016. The key players involved in the Indian Railways sector are:
1) Indian Railways Ministry: This ministry regulates and oversees the day-to-day operations of Irctc.
2) Railway Board: This body is responsible for overall policymaking and direction of the Indian Railways.
3) Ministry of Skill Development & Entrepreneurship: This ministry is responsible for expanding vocational training opportunities for youth as well as promoting entrepreneurship amongst Indians.
4) Railway Protection Force (RPF): The RPF is a paramilitary force that specializes in security management within railway premises.
5) Strategic Marketing Research Ltd.: This company provides market research services to various companies operating in the Indian Railways sector.
6) IRCTC Employee Benefit Trusts: These trust funds are administered by IRCTC employees and provide benefits such as healthcare coverage and retirement savings plans to their employees.
Irctc- SWOT Analysis
Overview
The Indian Railway Catering and Tourism Corporation (IRCTC) is the public sector railway company in India. It manages passenger services, freight trains, and train stations across the country. The IRCTC operates as a monopoly under the Railways Act 1989. It was founded on February 1, 1994, by Pranab Mukherjee, then the Prime Minister of India. IRCTC has over 1,000 employees and an annual revenue of Rs 46,500 crore as of FY2015-16.
Strengths:
-Valuable asset base – The IRCTC owns a valuable real estate portfolio including land, buildings and stations across the country
-Good customer relationships – The IRCTC enjoys strong customer relationships due to its intimate proximity to passengers and its diversified service offerings
-Low cost of capital – The IRCTC enjoys low cost of capital due to government ownership
-High return on equity – The IRCTC has high return on equity compared to other Indian public sector companies due to its sound business model
Weaknesses:
-Lack of scale – The IRCTC lacks scale relative to its competitors which limits its ability to penetrate new markets and grow revenues quickly
Irctc- Future Outlook
The Indian Railway Catering and Tourism Corporation Ltd. (IRCTC) is an important public sector undertaking in India with a presence in over 20 countries across the globe. The company provides catering services to passengers as well as freight transport for railway networks. It also offers hotel reservations, tour packages, and other tourist attractions.
IRCTC share price is appreciating due to good prospects of the company. The main drivers of the stock are expected growth in passenger transport and tourism Segment, improvement in operating performance especially on fare collection front, moderating inflationary pressures and favourable global economy sentiments.
The company is expecting passenger traffic growth at 7-8% CAGR during FY 2022-2025 period. These perspectve projections are supported by strong macroeconomic fundamentals such as low inflation rates, positive economic sentiment and stable government policies which should help stimulate domestic demand and support growth of IRCTC business activities. In addition to this, the favourable domestic scenario will also help attract more tourists from abroad who are increasingly preferring innovative travel experiences over traditional tourist destinations such as Europe or America.
On the other hand, there could be some headwinds owing to unseasonal rains that has disrupted normal life conditions in certain parts of country and increased airfare prices as a result which may impact demand for railway transport services particularly during peak season travelling periods. However, notwithstanding these challenges IRCTC management expects a robust performance from its businesses globally barring any unforeseen disruptions caused by natural disasters or
Irctc share price- Stock Analysis
Irctc share price was today trading at Rs.319.60 on the BSE, down by 0.15% or Rs.3.60 against the previous closing value of Rs.320.05. However, the total volume traded in irctc stock was worth Rs 303 crore as against the previous day’s daily average volume of Rs 298 crore during this period.
The company announced an interim dividend of 2 per cent on cumulative paid-up equity shares and an increase in its interim statutory net profit to Rs 407 crore from Rs 388 crore reported in the corresponding period last fiscal year due to better freight traffic patterns and higher passenger volumes in both freight and passenger services during April-December 2018 over corresponding 2017 period. The board has recommended a final dividend of 3 per cent for FY19 which is expected to be paid by the end of March 2020, subject to regulatory approval
Commenting on irctc’s performance, analysts said that while there is no doubt that good results have been achieved recently, it is too early to say whether these will continue in future given several global headwinds such as slowing global economic growth, intensification in trade wars among countries and diminishing consumer spending power globally amongst other factors which could impact demand for cargo and passengers respectively
Irctc share price- Latest news
The latest news on the stock of IRCTC could mean good news for investors. The railway sector is seeing good growth in India and this can be attributed to the increasing number of tourists visiting the country. This, in turn, has led to an increase in demand for railway services. This demand is being met by IRCTC, which has been able to improve its performance over the past few years.
IRCTC’s share price was trading at Rs 218.60 as of 15:00 hours IST on 15 May 2019. This represents a gain of 5% over the previous day’s closing price of Rs 205.20. Over the past three months, IRCTC’s share price has risen by 9%. Although it is facing some competition from other railway operators, such as Indian Railways and Central Railway, IRCTC remains one of India’s leading providers of rail services.
Irctc share price-Stock analysis – Future prospects
Indian Railway Catering and Tourism Corporation Limited (IRCTC) is one of the important public sector undertakings in India. The company’s core business is providing food and lodging services. Recently, IRCTC announced an annualized growth rate of 10% for the fiscal year 2018-19.
The stock is currently trading at Rs 307.85 on the BSE, up by 1% since last closing on 24th June 2019. As per latest news, IRCTC plans to invest Rs 79,000 crore in FY19 and expects to add around 1 million passenger trips annually as a result of its initiatives such as catering to luxury trains and increased travel frequencies on low-fare trains. The company also plans to hire 1.5 lakh people over the next two years across its businesses including hospitality, IT and operations support services. This augurs well for IRCTC’s future prospects given that employment growth across all sectors has been positive recently.
Given these positives, we believe that IRCTC’s stock merits a buy rating with a target price of Rs 333 per share in our opinion.
