IRCTC sees profit booking after shares hit 52-week high

Shares of IRCTC surged over six percent to hit a 52-week high of Rs 2,727. In the opening trade on Friday, the shares surged a percent higher to hit an intraday high of Rs 2,715 but then dropped a percent to Rs 2,664 after witnessing a bout of profit booking.

While announcing the results of the first quarter for the financial year 2022, Indian Railways’ catering and tourism arm announced a split of IRCTC shares into 1:5. The stock split is subject to approval by Indian Railways and the Government of India.

If the approval gets a nod from the shareholders, the face value of its shares would decrease to Rs two from the existing Rs 10. Its share price will also come down five times to Rs 500-550.

While the stock split will not affect the company’s valuations, it will make the stock accessible to small investors.

IRCTC said the decision will help enhance its liquidity in the stock market, make the shares affordable to small investors, and widen its shareholder base.

The company reported a surge in net profit on Thursday. From a loss of Rs 24 crore a year ago, it has posted a net profit of Rs 82 crore for the first quarter of FY22. However, the net profit is lower QoQ. It reported a profit of Rs 103 crore in the fourth quarter of FY21.

IRCTC also reported an 85.4 percent rise in its revenue from operations YoY, to Rs 243 crore from  Rs 131 crore reported a year ago.

Segment-wise, while its revenue from the catering segment fell 37 percent to Rs 56 crore, YoY, its internet ticketing revenues rose over 300 percent to Rs 149 crore. Also, its revenue from the tourism category more than doubled to Rs seven crore, YoY.