IRCTC shares surge over 2% after reporting 166% rise in Q3 net profit

Indian Railway Catering and Tourism Corporation (IRCTC) shares surged over 2% to Rs 855.05 on the BSE at 9:50 am on Wednesday after reporting strong Q3 results.

The catering and tourism arm of Indian Railways posted a consolidated net profit of Rs 208 crore for the December quarter, up 166% from the previous year’s figure of Rs 78 crore.

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The sharp increase in net profit is mostly due to contributions from all segments and a low base of the previous year. Due to coronavirus-related limitations, IRCTC operations have been muffled, with reduced rail operations and public travel.

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Net profit after tax increased by 32%, year on year, from Rs 158 crore. Revenue from operations increased by 141% to Rs 540 crore in the December quarter, compared to Rs 224 crore in the same quarter the previous year.

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The board of the company has announced an interim dividend of Rs 2 per share for the financial year 2021-22. On the NSE on Tuesday, IRCTC shares rose 0.38% to settle at Rs 838.75 each. The board has set Friday, February 18, as the record date for the payment of the interim dividend for the year 2021-22.

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For the reporting quarter, the company’s EBITDA (earnings before interest, tax, depreciation and amortisation) increased by 195% to Rs 279 crore. Catering services revenue increased by 117% to Rs 104 crore during the quarter under review. In the previous year’s corresponding quarter, the figure was Rs 48 crore.

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Revenues from the internet ticketing sector have also more than doubled, growing 118% to Rs 312 crore in the December quarter from Rs 143 crore in the same period of the previous year. Tourism revenue increased by 353% to Rs 68 crore in the third quarter. In the same quarter of the previous year, the figure was a meagre Rs 15 crore.

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Other income for the public sector company decreased to Rs 16 crore, down from Rs 21 crore in the same quarter of the previous year. According to market analysts, the latest Budget declaration on extra Vande Bharat trains will drive IRCTC’s share price in the long run.