As of 15th November 2023, IRCTC’s share price is trading at Rs. 676 with a market cap of Rs.54,080 Crore. IRCTC, the Indian Railway Catering and Tourism Corporation has demonstrated exceptional financial performance in the past year, surpassing its sector’s average growth rates.
With an impressive 87.6% rise in annual revenue and a 51.6% increase in net profit, the company has outpaced its peers’ average revenue and net profit growth of 21.1% and 23.7% respectively. Moreover, the company’s debt-free status and recent 7% surge in share price indicate a strong and promising outlook for IRCTC in the market.
Let us explore the future trajectory of IRCTC’s share price.
In this analysis, we’ll delve into the potential targets for IRCTC’s share price from 2023 to 2030, specifically focusing on the question: Can IRCTC achieve a remarkable milestone of reaching 1000 INR? By examining the factors influencing IRCTC’s performance, market trends, and the broader economic landscape, we aim to shed light on the feasibility of this ambitious target. Join us as we embark on a journey to decipher the potential prospects and challenges that lie ahead for IRCTC investors and enthusiasts.
The Indian Railway Catering and Tourism Corporation (IRCTC) is a prominent Indian public sector undertaking that was established in 1999 and is headquartered in New Delhi.
It operates under the umbrella of the Indian Railways and offers a wide range of services, including online ticketing, catering, tourism, and hospitality.
IRCTC played a pioneering role in introducing internet-based rail ticket booking through its website and mobile platforms. Additionally, it operates pantry cars, provides freshly cooked food onboard long-distance trains, and manages food plazas, cafeterias, and lounges at railway stations.
The corporation has also ventured into the tourism sector, organizing budget and luxury package tours for both domestic and foreign travellers, including well-known luxury train journeys.
However, it has faced criticism over data privacy concerns related to passenger information leaks and unauthorized promotional usage. Despite this, IRCTC remains a crucial entity in India’s railway ecosystem, serving millions of passengers and tourists annually.
- Net profit increased by 30.4% to ₹294.7 crore.
- Revenue from operations grew by 23.5% to ₹995.3 crore.
- EBITDA reached ₹366.5 crore, up by 20.2%.
- EBITDA margin was 36.8%, slightly lower than the previous year.
- Internet ticketing revenue saw a marginal increase to ₹327.5 crore.
- Sales from State Teertha surged by 119% to ₹64.84 crore.
- Catering segment sales rose by 29% to ₹431.5 crore.
- Tourism segment sales jumped by 39% to ₹96.55 crore.
- Interim dividend of ₹2.50 per equity share declared for FY23-24.
- The board approved the formation of a wholly-owned subsidiary for IRCTC I-Pay business.
- Audit appointments made for secretarial and internal auditors.
- Record date for dividend payment set for November 17, 2023.
- IRCTC shares settled 1.41% higher at ₹680.85 apiece on the BSE.
You can buy IRCTC shares through various stockbrokers in India such as:
- HDFC Securities
- ICICI Direct
- Axis Direct
- Kotak Securities
- Angel Broking
- Motilal Oswal
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IRCTC Financial Condition: Last 5 Years
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Over the past five years, from 2019 to 2023, IRCTC’s financial performance has shown a significant growth trajectory. The company’s sales revenue exhibited a remarkable increase, starting at INR 1,870 crores in 2019 and progressively soaring to INR 3,541 crores in 2023. This expansion was accompanied by prudent expense management, as the company controlled its expenses efficiently, maintaining a steady balance between growth and cost control. The operating profit, reflecting the effectiveness of these strategies, grew from INR 383 crores in 2019 to INR 1,276 crores in 2023, showcasing a notable surge in profitability.
The company’s operational performance, as indicated by the Operating Profit Margin (OPM %), showcased a consistent positive trend, reaching an impressive 36% in 2023, highlighting its ability to generate profits from its core operations. Furthermore, IRCTC’s ability to diversify revenue streams is evident in its consistent growth in other income, which increased from INR 126 crores in 2019 to INR 148 crores in 2023. Despite some minor fluctuations, the company effectively managed its financial obligations, with interest and depreciation remaining relatively stable over the years. IRCTC’s prudent financial management is also underscored by the steady decline in tax percentages, indicating efficient tax planning.
In terms of bottom-line performance, the net profit witnessed a remarkable surge, escalating from INR 309 crores in 2019 to INR 1,006 crores in 2023. This growth was further reflected in the substantial increase in Earnings Per Share (EPS), rising from INR 3.86 in 2019 to INR 12.57 in 2023.
This robust financial performance enabled IRCTC to maintain a consistent dividend payout to its shareholders, ranging from 39% to 44% over the five years.IRCTC’s financial condition over the last five years exemplifies a commendable growth trajectory, characterized by consistent revenue expansion, disciplined expense management, and improved profitability. The company’s ability to navigate market dynamics and optimize its operations positions it favourably for continued financial success in the years ahead.
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The share price target for IRCTC by 2023 is projected to continue its upward trajectory. Based on our analysis, the company’s share price trend has been positive, with a maximum of ₹1,952.71 and a minimum of ₹1,366.89 by 2030.
The share price target for IRCTC by 2025 indicates a continued upward trend. The projected range showcases growth potential, with a maximum of ₹1,072.92 and a minimum of ₹721.41 by December 2025.
Is it worthwhile to invest in IRCTC for the long term?
Considering the consistent growth trajectory of IRCTC’s share prices over the years, coupled with the company’s expansion strategies and robust financial performance, investing in IRCTC for the long term seems to hold promise. However, it’s advisable to conduct thorough research and consider various factors before making any investment decisions.
Will the IRCTC stock grow?
Yes, based on the analysis and the consistent upward movement of IRCTC’s share prices over the years, there is a positive indication that the stock will continue to grow. The company’s strategic initiatives and strong financial foundation contribute to its growth potential.
When will IRCTC reach Rs. 1000?
As per our analysis, IRCTC’s share price may reach Rs. 1000 by November 2025.
The analysis of IRCTC’s share price targets spanning the years 2023 to 2030 unveils a compelling narrative of consistent growth and potential.
IRCTC share price is up 4 times in the last 3 years. It is currently trading with a PE ratio of 50.1. Though the book value is just Rs. 35.6, IRCTC is still a good choice any day for anyone who wants to stay invested long term.
PE ratio has fallen from 324 to 50.1, in the last 2 years. The median PE is 70.8. The stock also stands corrected from the highs of Rs. 1093 to Rs. 676 (current price), down 39% from its ATH. In my opinion, IRCTC at present stands at a fair valuation. IRCTC shares are not cheap but stand slightly on the premium end. Given the future growth prospects, we can say IRCTC is fairly valued. The IRCTC sales and profits are expected to grow in the upcoming years.
While the precise figure of reaching ₹1000 INR by 2025 remains uncertain, our analysis underscores the possibility of such an achievement given the trend. The positive outlook extends beyond 2025, with subsequent years indicating a remarkable climb in share prices, reaching levels as high as ₹1,952.71 and ₹1,366.89 in 2030.
In my opinion, IRCTC share price is gaining momentum, and the stock is good for both the short and long term.
However, it is essential to approach these projections with caution, recognizing that stock markets are influenced by multifaceted variables. Investors should consider a holistic assessment of market conditions, IRCTC’s operational strategies, and broader economic factors. The company’s sustained growth potential, consistent upward trajectory, and strategic expansion plans certainly make it an attractive candidate for long-term investment.
What did we learn?
- 1 About IRCTC
- 2 IRCTC Q2 FY24 Highlights
- 3 How to Buy IRCTC Shares in India?
- 4 IRCTC Share Price Target: 2023 to 2025
- 5 IRCTC Financial Condition: Last 5 Years
- 6 FAQs
- 7 Conclusion: Should you invest in IRCTC shares in 2023?