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IRCTC shares fall over 1% ahead of June quarter earnings

IRCTC, which operates in four business segments- internet ticketing, catering, packaged drinking water under the “Rail Neer” brand, and travel and tourism- has suffered a serious blow due to COVID-19.

September 14, 2020 / 01:53 PM IST

Shares of Indian Railway Catering and Tourism Corporation (IRCTC) traded in the red after falling over a percent in morning trade on BSE on September 11.

The company will release its June quarter earnings later today.

IRCTC, which operates in four business segments- internet ticketing, catering, packaged drinking water under the “Rail Neer” brand, and travel and tourism- has suffered a serious blow due to COVID-19.

Keshav Lahoti- Associate Equity Analyst, Angel Broking said the company's long-term fundamentals are intact.

Currently, the Government of India holds 87.4 percent in IRCTC. As per SEBI minimum public shareholding requirement, promoters can hold a maximum 75 percent in the company.

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"So, to comply with SEBI regulation, as per media reports, the government is planning to sell 15-20 percent in the company in the minimum number of tranches. Amount raised from OFS will help the government in managing the fiscal deficit in these unprecedented times of COVID-19," Lahoti pointed out.

The analyst believes there could be short-term pressure on the stock if the government announces OFS as the free float will increase in the market.

Shares of IRCTC traded 0.87 percent lower at Rs 1,358.65 on BSE at 11:15 hours.

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Moneycontrol News
first published: Sep 11, 2020 11:26 am
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