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Views invited pls, seems like a game chaging decision, if implemented
Do you mean negatively game-changing?
Merging asset heavy infrastructure companies with a clean internet ticketing platform would definitely be a big negative in my view. Even though IRCTC is into 4 different lines of business, I think almost everyone is betting on it’s monopolized e-ticketing platform business and other businesses are just cherries on the cake especially from valuation perspective. You add too many cherries and the value of the cake will most likely go down.
Government interference and regulation is the major and no.1 risk in this business. I will exit if they are forced to run too many businesses especially ones not associated with travel/tourism/food. It’ll become a unnecessary conglomerate and people will start calling for demerger of e-ticketing business. Let’s hope we don’t get there.
Disc: Invested from 1350 levels
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100% on point. Big Big negative. that is the risk that PSUs carry. unnecessary interference by Babus.
Disc: Invested since OFS. have trimmed position in last 15 days.
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In what could be a major coming together of organisations working on the Information Technology platform, the panel recommended winding up of CRIS, an autonomous society that develops software capacity in the railways that includes passenger ticketing, freight invoicing, passenger train operations, management of train crew and management of fixed/rolling assets, and handing over all its work to the Indian Railway Catering and Tourism Corporation (IRCTC).
Going by the plan, RailTel, one of the largest telecom infrastructure providers in the country that focuses on modernising operations and safety systems through optic fibre networks that exist along railway tracks, would be merged with IRCTC. It has been proposed for the Rail India Technical and Economic Service (RITES) that exports rolling stock to take over Braithwaite & Co Ltd., (BCL) which turned sick in 1992, the sources said.
CRIS looks interesting and if integrated well can actually strengthen IRCTC’s core business. There is little publicly available data on CRIS, and my initial perception is that it needs some attention and support.
RailTel, although profitable appears somewhat unrelated to what IRCTC does. But if you take a closer look, it appears that the ministry is trying to bundle together all technology services of railways into IRCTC. RailTel has a diversified portfolio. Apart from telecom infrastructure, it also offers managed data services, hosting and system integration services.
Disclosure: Invested at IPO, sold during COVID 1st wave and reinvested just before COVID 2nd wave and currently holding.
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Original recommendation of merging the three entities was there in the “Report of the committee for mobilization of major railway projects and restructuring of railway ministry and railway board”. June 2015.
Para 2.12 , page 57.
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IRCTC to launch special tourist train for 5 North Eastern States.
Indian Railways will soon introduce a special tourist train for exploring five North Eastern States under the initiative ‘Dekho Apna Desh’, news agency ANI reported on Sunday. The trip will be for 14 nights and 15 days.
The train will take passengers to places that are not just far from the crowd but also are untouched, unexplored and unimaginable. Be ready to travel on Dekho Apna Desh AC Deluxe Tourist Train on a wonderful tour of northeast discovery beyond Guwahati, said an officials of IRCTC (Indian Railway Catering and Tourism Corporation).
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Hi members,
I was just going through the financials of the company and wondering that doesn’t the valuation of the company look too good to be true at consensus EPS of ~62 for FY23 which leads to 2 yr fwd PE of 71.77 at today’s price and taking in sales for FY20 at 2264 Cr which are the best for last few years , assuming full normalization in the current fiscal , EV/sales is at ~30.9.
Plus, considering the fact that Nasdaq has been in a down trend recently and growth stocks are underperfoming in the short term(last couple of weeks) , Is the recent euphoria a bit overdone?
Thoughts/responses welcome.
Disc: not holding , may look to trade some.
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Discl: Invested at @800 level from secondary market and added @ 1200-1500. May be biased…please do your own assessment before investing.
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Broadly there are so many triggers available for this stock, this is all I could collate
- Bus booking pick up, remember the opportunity size is huge with long runway
- IPay approval from RBI & cross selling to other dept’s
- Merger of CRIS & Railtel, CRIS brings UTS app, PRS, Freight Management system & Parcel Management systems
- Ecatering income & branding, food aggregator & uptick, remember they have increased commission from 12% to 15% & orders in ECatering have gone beyond precovid levels
- Private train operations & balance Tejas handing over
- Gradual increase in Catering operations & impact of price hike announced in Feb 2020 if I am not mistaken
- 2S booking impact, has led to 42% more availability of reserved seats
- Planned Tie up with 2 operators for Flight bookings
- Data Monetization plans
- Resumption of balance 800 trains
Disclosure: invested, views biased
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I have an unusual observation to share on the price movement of IRCTC share:
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There’s similarity between Zee Entertainment share of 1999-2000 and IRCTC of 2019-2021.
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Between 1999-2000 Ketan Parekh manipulated one of his K-10 stocks, namely, Zee Entertainment share price by approximately 21+ times by rallying it from around Rs.35/- per share to over Rs.700/- per share within 2 years.
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IRCTC share listed at Rs 320/- IPO price in late 2019 has touched Rs.6400/- appx in 2021… That’s also 20 times in 2 years.
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Same pattern… without any significant jump in sales or profit in both cases.
I had thought of this point 3 days back when it was trading at Rs.5500/- and at 17 times high from IPO price. And incidentally it went to 6400 and toppled 30%+.
It’s also unusual that a PSU stock is trading at a PE ratio of well over 300, market cap of 1 lakh cr while sales are miniscule in comparison and the book value is a mere Rs.92/- or so in comparison.
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Flybig, IRCTC enter pact for ticket booking
Invested since IPO allotment
Insightful analysis on IRCTC
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