Ministry of Railways has decided to withdraw its decision to ask its catering and tourism arm, the Indian Railways Catering and Tourism Corporation (IRCTC), to share half of all the convenience fee revenue it earns, DIPAM secretary Tuhin Kanta Pandey told CNBC-TV18.
"Ministry of Railways has decided to withdraw the decision on IRCTC convenience fee," DIPAM Secretary Tuhin Kanta Pandey tweeted.
A senior Railways official told Moneycontrol that the convenience fees sharing had been there before the pandemic.
“It was made 100 percent to the company only for the pandemic,” the official said, asking not to be named.
Also read | IRCTC, Railway board to meet today to discuss revenue sharing
It was reported on October 28 that IRCTC would have to share revenues acquired from convenience fees for bookings made on its platform in a 50:50 ratio with the Ministry of Railways. Convenience fees charged from customers generated a sizable revenue for IRCTC. The fee is not part of the rail fare. It is for the service of online ticket booking offered by the IRCTC.
On October 29, IRCTC share price locked at 20 percent lower circuit after the above-mentioned report.
There were pending sell orders of 3,933,837 shares, with no buyers available.
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Mutual funds reduced their stake in IRCTC to 4.78 percent, as of September, from 7.28 percent in the June quarter. The names of Nippon Life India Trustee and Aditya Birla Sun Life Trustee did not appear in the September quarter's shareholding pattern.
Foreign portfolio investors also lowered ownership to 7.81 percent from 8.07 percent in the same period, but LIC upped its stake to 2.11 percent from 1.9 percent.
Also read: Govt diktat on IRCTC -- penny wise, pound foolish
Individual shareholders, with holding below Rs 2 lakh worth of shares, increased their shareholdings to 14.17 percent from 11.26 percent, but high net worth individuals reduced their stake to 0.14 percent from 0.22 percent on a QoQ basis.
Also read: IRCTC – The super-fast train suddenly jumps the rails
IRCTC’s board of directors will meet on November 1 to consider and approve the unaudited financial results for the second quarter and the half-year ended on September 30.
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