IRCTC share price hits all-time high, surges three times from IPO price; stock may rally up to 40%

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March 04, 2021 3:04 PM

IRCTC share price hit a new record high of Rs 2,014 apiece, rising as much as 7 per cent in the intraday on BSE.

IRCTC share price, IRCTC, Indian railwaysIRCTC offers a monopolistic opportunity in online rail ticketing, sale of Packaged Drinking Water (PDW) and catering services (in Train as well as 600 stations) for Indian Railways. Image: Reuters

IRCTC share price hit a new record high of Rs 2,014 apiece, rising as much as 7 per cent in the intraday on BSE. Indian Railway Catering and Tourism Corporation Ltd stock price has surpassed its previous high of Rs 1,995 apiece touched on February 25 last year. So far, a total of 3.95 lakh shares have traded on BSE, while 79.54 lakh shares have exchanged hands on the National Stock Exchange. The stock fell to a record low of Rs 775 on March 26, 2020, due to the COVID-19 pandemic induced lockdown. In less than a year, IRCTC stocks have surged 160 per cent from an all-time low level. “In the whole momentum, it has shown major support at 50% retracement zone near 1315 levels where the long-term support exists now,” Vishal Wagh, Head of Research, Bonanza Portfolio Ltd, told Financial Express Online.

IRCTC made its market debut on October 14, 2019, and was listed at Rs 644 against its issue price of Rs 320 per share. Since listing, IRCTC stocks have zoomed three times or 213 per cent. Wagh added that on the first trading day of the March series, it has already crossed its monthly R1 levels of 1893 with a stronger 10 per cent upside as it has entered the future and option basket. “For the current month, it is expected to trade above 1810 and today it has crossed the all-time high of 1994 and if it closes above this level, then IRCTC will move in uncharted territory,” Wagh said. On the higher side, he added that a rally till 2350 can not be ruled out in the coming 1-3 months.

In a recent BSE filing, IRCTC informed that it will operate trips through Golden Chariot — Pride of Karnataka and Jewel of South — from March 14, 2021, onwards. Binod Modi, Head strategy at Reliance Securities, told Financial Express Online that a sharp increase in FIIs and Mutual Fund holdings in Dec’20 quarter led by OFS created the positive sentiment in IRCTC stock. Notably, FIIs’ holdings increased from 1 per cent to 8.4 per cent during 3QFY21. “Further, expectations of opening up the economy in a broader way and possible resumption of railway services at large scale also supported the stock rally,” Modi added.

IRCTC offers a monopolistic opportunity in online rail ticketing, sale of Packaged Drinking Water (PDW) and catering services (in Train as well as 600 stations) for Indian Railways. Dolat Capital Market Private Ltd said that its PDW brand (Rail-Neer) sells water cheaper by 33 per cent compared to other branded alternatives. Catering business exclusivity ensures quality, pricing and availability to travellers. Analysts at the brokerage firm have given a ‘buy’ rating to the stock with a target price of Rs 2,650 apiece, implying an upside of over 40 per cent from the previous close. “The multiple levers for growth specifically conversion of unreserved coaches into 2S would be more than suffice to cover up for growth lost due to COVID pandemic,” analysts said.

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