The much-awaited Rs 600 crore Indian Railway Catering and Tourism Corporation (IRCTC) public offer may hit the stock market coming Navratri, sources aware of the development told Financial Express Online.
The Indian Railway Catering and Tourism Corporation (IRCTC) IPO may hit the bourses as soon as this month itself, with the PSU eyeing to launch the much-awaited public issue in the coming Navratri season, which begins 29 September 2019, sources aware of the development told Financial Express Online. The railway PSU had filed the DRHP (draft red herring prospectus) with capital market regulator SEBI in August this year. Through the IRCTC IPO, the government is looking to offload up to 2 crore shares to raise between Rs 500 and 600 crore, according to a recent PTI report. Following the public offer, the government’s stake in IRCTC will come down by 12.5%. IDBI Capital, SBI Capital Markets and Yes Securities will handle the initial public offering.
According to the firm’s DRHP, IRCTC garnered a revenue of Rs 1,899 crore in FY19, up 25% from the previous fiscal. IRCTC’s net profit jumped 23.5% on-year to Rs 272.50 crore in fiscal year 2019. The firm which sells tickets for Indian Railways and handles its catering services recorded a whopping 72 lakh logins per day, and 2.5 crore logins in a month, data from DRHP showed. IRCTC is one of the most transacted websites in the Asia-Pacific region, with customers booking about 8 lakh tickets per day. Incorporated by the government in 1999, IRCTC was conferred the status of Miniratna (Category-I Public Sector Enterprise) status in 2008.
While the firm’s ticket sales records are notable, IRCTC’s catering business contributed to a major chuck of the total revenues. Out of the total, IRCTC earned Rs 1,044 crore from catering, and Rs 444 crore from its tourism and travel related services. Through ‘Rail Neer’, its packaged drinking water business, IRCTC garnered Rs 176 crore in revenues in FY19.
The IPO is part of Narendra Modi-led government’s mega disinvestment programme to raise a record Rs 1.05 lakh crore in 2019-20, or about Rs 20,000 crore more than it collected in the previous fiscal. IRCTC IPO comes after the central government approved listing of five railway entities—IRCON International, RITES, Rail Vikas Nigam Ltd, IRFC and IRCTC. Notably, IRCON International and RITES made their market debut in fiscal 2018-19. Further, in April this year, the government had raised about Rs 480 crore through RVNL (Rail Vikas Nigam Ltd) initial public offer, selling 12.2% stake in the company.