Hold Indian Railway Catering and Tourism Corporation; target of Rs 709: Prabhudas Lilladher

Buy

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Prabhudas Lilladher's research report on Indian Railway Catering and Tourism Corporation

We re-align our EBIT margin assumptions for catering division resulting in a marginal EPS upgrade of ~1% over FY24-FY26E. Indian Railway Catering & Tourism Corporation (IRCTC IN) reported better than expected operational performance with EBITDA margin of 36.8% (PLe 34.0%) led by a beat in catering segment. We believe catering division has earnings optionality arising from 1) tie-up with Zomato 2) managing trains/coaches booked on full tariff rate (FTR) 3) ~200 contracts that are in pipeline and 4) expected onetime gain arising from increase in license fee which has been pending as the matter is sub-judice. We expect PAT CAGR of 11% over FY23-FY26E given 1) traction in non-convenience revenue 2) rail neer expansion and 3) healthy growth in catering segment.

Outlook

However, we believe valuations at 43x/41x for our FY25E/FY26E EPS estimates price in most of these benefits and thus we maintain our ‘HOLD’ rating on the stock with a TP of Rs709 (45x FY25E EPS; no change in target multiple).

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Indian Railway Catering and Tourism - 09 - 10-2023 - prabhu