IRCTC: a necessity, a monopoly

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Are we seeing change in management ?

a. Appointment of Sh. Jagtosh Shukla as Group General Manager.

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b. Appointment of Sudhir Kumar as CFO of IRCTC.

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c. Additional charge of Director (Finance) approved.

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  • Rumor has it that a QIP of 5000 cr is lined up ? Can anyone confirm it, saw nothing on exchanges though
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Board to consider dividend, could be between 3-4/sh

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IRCTC Q3 FY25 Highlights

  • Record Revenue: ₹1,225 Cr, highest-ever quarterly revenue.
  • Internet Ticketing: ₹353.72 Cr (+5.4% YoY), 84.7% margin remains strong.
  • Catering: ₹554.81 Cr (+15% QoQ, +9% YoY), margins dipped to 12.19% due to segment dynamics.
  • Tourism: ₹224 Cr (+80% QoQ, +16% YoY), driven by luxury trains & state tourism.
  • Rail Neer: ₹92.3 Cr (+7% QoQ, +16% YoY).

:small_blue_diamond: Future Focus:

  • Expanding non-conventional income beyond internet ticketing fees.
  • Strengthening base kitchen infrastructure to meet rising catering demand.
  • Growing luxury train offerings amid surging domestic tourism.

IRCTC continues to capitalize on India’s travel boom!

Company declared 3 INR dividend

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Good Q3FY25 numbers by IRCTC with a decent uptick on revenue fronts. The combined EPS of 3 quarters of FY25 now stands at Rs. 11.97. So, if the company performs on a similar level in Q4 as in Q3, it will be able to meet the median estimate numbers.

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However, analysts have been downgrading the estimates in the last few weeks (which is not a positive sign).

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IRCTC Revenue Impact | Kumbh Mela

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a. Special trains covering Pragyaraj, Varanasi and Ayodha

b. 100 rooms and 100 tents and Mahakumbh Gram-Tent City were sold out reflecting high demand

c. Benefits of this “Mahakumbh Yatra” will directly reflect on ticketing, categing and Rail Neer in upcoming quarter only.

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The Government has approved the upgradation of Indian Railway Catering and Tourism Corporation (IRCTC) to Navratna CPSE, making it the 25th Navratna among CPSEs!

IRFC Management explains what Navratna status actually means to the company

  • Navratna status is a big milestone and gives us the autonomy to take decisions faster
  • Won request for proposals worth ₹3,200 cr in Jharkhand and ₹7,500 cr with NTPC Renewables in last 2 months.
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Hi guys - IRCTC is trading around 750 levels. Corrected, but still pricey.
There aren’t too many regulatory based monopolies anymore. Coal India lost its monopoly, and now private players are let into the space.

My question is what’s the likelihood that the vertical that IRCTC operates in the ticketing business gets privatised?

I personally don’t think this can happen for two reasons, but I would definitely like your thoughts.

First, we really do underestimate the capability of handling such volume of ticketing business, Tatkal, etc. Bookmyshow crashed for the Coldplay concert, just showed how well built IRCTC is - basically saying private players won’t be able to handle the sheer volume.

Secondly: private players are already enjoying this, though fee sharing models with IRCTC. so now that this already exists, further privatisation may be unlikely.

Like for each ticket book the PSP (principle service provider) has to pay IRCTC around 12 + tax.
I think that’s safe to assume this is where privatisation ends.

Risks:
Fee sharing with government, happened in the past. Was reverted, but that would’ve cut revenues by a quarter, and profitability by almost half.
That’s probably unlikely to happen given the Navratna status and how the previous video states that navratna status grants more autonomy.

Navratna Advantage

Higher Financial Autonomy: Can invest up to Rs 10 bn or 15% of net worth in a project without prior approval.
Operational Flexibility: Freedom to form joint ventures, alliances, and global ventures swiftly.
HR Autonomy: Greater control over hiring and compensation policies.
Global Expansion: Easier entry into international markets.
Source: Equitymaster

Lack of growing in ticketing.
Growth should mostly be driven by catering, rail neer and tourism.
catering jumped form 25% revenue to 45%+ in literally 1 year or so.

Of course profitability will be driven by ticketing business only.

Do share your thoughts.
This business is very similar to what warren calls toll bridge kind of business.
Given the world is moving into a less free-trade sort of an environment, domestic facing businesses definitely should be a part of portfolio.

Disclose: Not invested, just tracking

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