(Last Updated On: September 9, 2019)

We have been discussing a lot of upcoming IPOs recently. Here we bring for you another eye catching Initial Public Offering: IRCTC Ltd. IPO Review, its listing dates, pricing and subscription other important details.

IRCTC Limited: Company Overview

Incorporated as Indian Railway Catering and Tourism Corporation Limited  on September 27, 1999 IRCTC Ltd is a Central Public Sector Enterprise which is wholly owned by the Government of India and is under the administrative control of the Ministry of Railways.

IRCTC Ltd is the only entity authorized by Indian Railways to provide catering services to railways, online railway tickets and packaged drinking water at railway stations and trains in India. IRCTC Ltd got the status of Mini Ratna (Category-I Public Sector Enterprise) by the Government of India, on May 1, 2008.

And, you know what? www.irctc.co.in is one of the most transacted websites in the Asia-Pacific region with transaction volume averaging 15 to 18 million transactions per month during the three months ended June 30, 2019.

IRCTC Ltd. does not have any financial or strategic partners. It neither has a holding company nor any subsidiaries. IRCTC has a joint venture company namely Royale Indian Rail Tours Limited, with Cox & Kings (India) Limited.

IRCTC Limited: Services Offered

Currently, IRCTC Ltd. operates in 4 business segments:

  1. Internet Ticketing
  2. Catering
  3. Packaged Drinking Water (Rail Neer)
  4. Travel and Tourism

Let’s gather some more interesting facts on each of these services offered by IRCTC Ltd.

1. Internet Ticketing:

IRCTC Ltd is the only entity authorized by Indian Railways to offer railway tickets online through their website (www.irctc.co.in) and mobile application (Rail Connect).  On daily basis, more than 0.80 million tickets are booked through www.irctc.co.in and Rail Connect app.

2. Catering:

IRCTC Ltd provides food catering services to Indian Railway passengers on trains (mobile catering) and at stations (static catering) for approximately 350 pre-paid and post-paid trains and 530 static units. The company also offer e-catering services to passengers through mobile application “Food on Track” and e-catering website, www.ecatering.irctc.co.in.

3. Packaged Drinking Water (Rail Neer):

IRCTC Ltd manufactures and distributes packaged drinking water under brand “Rail Neer”. The company operates 10 plants with an installed production capacity of approximately 1.09 million liters per day, which caters to approximately 45% of the current demand of packaged drinking water at railway premises and in trains.

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The company has also installed water vending machines (WVMs) at railway stations to provide purified, chilled and portable drinking water to railway passengers at an affordable price.

4. Travel and Tourism:

IRCTC Ltd. has been mandated by Indian Railways to provide tourism and travel related services. The company has footprints across all major tourism segments such as hotel bookings, rail, land, cruise and air tour packages and air ticket bookings.

IRCTC Ltd. IPO review, price, listing, allotment

IRCTC Ltd.: Key Strengths to Know

  1. IRCTC Ltd has been profitable and debt free company since incorporation.
  2. The company has not experienced any instances of time/cost overrun in their business operations.
  3. No defaults or rescheduling of borrowings with financial institutions in respect of the current borrowings from the lenders.
  4. Online rail bookings are expected to grow at approximately 8% CAGR to reach approximately 425-435 million in fiscal 2024.

Key Risks of IRCTC

  1. Any adverse change in policy of the Ministry of Railways.
  2. Any failure to maintain or enhance consumer awareness of the company brand.
  3. Declines or disruptions in the travel industry.
  4. As of March 31, 2019, contingent liabilities appearing in the financial statements aggregated to Rs.166.79 Cr.

Competitive Strengths of IRCTC

  1. Authorized by the Ministry of Railways to offer tickets of Indian Railways.
  2. An authorized catering service provider to passengers travelling by Indian Railways.
  3. Exclusively authorized for manufacturing and supplying packaged drinking water at railway station and trains.
  4. Comprehensive tourism and hospitality service provider in India.
  5. Qualified and experienced employees and management team.
  6. Robust operating system and internal control.

IRCTC Ltd. Team

Promoters

The promoter of IRCTC Ltd. is President of India acting through the Ministry of Railways, Government of India.

Directors

As on date,  IRCTC Ltd has has 11 Directors on its Board, which includes two Whole–time Directors, two Part–time Government Directors, six Part–time (Non–official) Directors and a Director with additional charge. As on the
date of the IPO Application, none of the Directors hold any equity shares in IRCTC Ltd.

S.No.NameDesignation
1
Mahendra Pratap MallChairman and Managing Director
2Rajni HasijaWhole-time Director (Tourism &
Marketing)
3NarendraDirector (Finance)
4Neeraj SharmaPart–time Government Director
5Smita RawatPart–time Government Director
6Kanak AggarwalPart–time (Non–official) Director
7Sarita DeshpandePart-time (Non-official) Director
8Rabi Narayan BohidarPart–time (Non–official) Director
9Dheeraj SharmaPart–time (Non–official) Director
10Comal Ramachandran SundaramurtiPart-time (Non-official Director)
11Sachin ChaturvediPart-time (Non-official) Director
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IRCTC Ltd. Financials

As on the date of filing IPO application, IRCTC Ltd. does not have any outstanding or sanctioned fund-based facilities.

However, they have availed certain bank guarantee facilities from Kotak Mahindra Bank Limited and IDBI Bank Limited aggregating to ₹ 86.10 million, in order to be able to meet their contractual obligations towards their clients.

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IRCTC Ltd: Summary of Assets and Liabilities (in Rs. Cr.)

ParticularsReferenceAs on 31.03.2019As on 31.03.2018As on 31.03.2017
Assets
Total non-current asset1a325.05258.87259.76
Total current assets1b2,258.722,060.221,566.68
Total Assets1c=1a+1b2,583.782,319.101,826.45
Equity
Equity share capital2a160.0040.0040.00
Other equity2b882.84914.52746.55
Total Equity2c=2a+2b1,042.84 954.52786.55
Liabilities
Total non-current liabilities3a66.69 89.6392.18
Total current liabilities3b1,474.241,274.94947.70
Total Liabilities3c=3a+3b1,540.931,364.581,039.89
Total Equity and Liabilities3d=2e+3c2,583.7802,319.101,826.45

IRCTC Ltd: Summary of Profit and Loss (in Rs. Cr.)

ParticularsReferenceAs on 31.03.2019 As on 31.03.2018As on 31.03.2017
Income
Revenue from operations1a1,867.881,470.461,535.38
Other Income1b88.7799.0967.46
Total Revenue(top-line)1c=1a+1b1,956.661,569.561,602.85
Expenses
Total Expenses2a1,526.691,223.921,247.78
Profit/ Loss
Profit before tax3a429.96345.63355.06
Tax3b157.36125.01125.98
Profit After Tax(bottom -line)3c=3a-3b272.59220.61229.08
Earnings Per Share
Basic in Rs.(Face value of Rs.10 each)3a17.0413.7914.32
Diluted in Rs.(Face value of Rs.10 each)3b17.0413.7914.32

IRCTC Ltd: Summary of Cash Flows (in Rs. Cr.)

ParticularsReferenceAs on 31.03.2019 As on 31.03.2018As on 31.03.2017
Cash Flows
Net cash generated from operating activities1a492.6623.62338.23
Net cash used in investing activities1b-346.3540.293.56
Net cash used in financing activities1c-179.39-56.79-135.94
Net Cash1d=1a+1b+1c460.07493.15486.11
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IRCTC Ltd: Return on Net Worth

Year/Period endedRoNW (%)Weight
March 31, 2019 26.143
March 31, 2018 23.11 2
March 31, 2017 29.121
Weighted Average25.63

Important Terms:

i. Return on net worth (%) = Restated profit after tax for the year / net worth as at the end of the year
ii. Net worth represents sum of Equity Share capital and other equity (including Securities premium, General
reserve, special economic re-investment reserve and retaining earnings).
iii. Weighted average RoNW is the aggregate of year-wise weighted RoNW divided by the aggregate of weights
i.e., ((RoNW x Weight) for each year) / (total of weights)

IRCTC Ltd: Net Asset Value per Equity Share

The Net Asset Value (NAV) per equity share is Rs.65.18 as on March 31,2019.

Net Asset Value per Share (Rs)= Restated net worth attributable to the equity shareholders at the end of the
period/ year / Number of Equity Shares outstanding at the period/ year.

IRCTC IPO Objective

  1. To carry out the disinvestment of equity shares.
  2. To achieve the benefits of listing the equity shares on the stock exchanges.

IRCTC IPO Offer Size

The Offer will comprise of a Net Offer of 20,000,000 Equity Shares and the Employee Reservation Portion of [●] Equity Shares. The Offer and Net Offer shall constitute [●]% and 12.50% of the post-Offer paid-up Equity Share capital of IRCTC Ltd, respectively.

IRCTC IPO Dates & Price Band : Coming Soon

IRCTC IPO Dates & Market Lot : Coming Soon

IRCTC IPO Dates & Allotment & Listing : Coming Soon

What do you think about this upcoming IPO? Is it worth investing in IRCTC Ltd Initial Public Offering? Or should you wait for some other options? Feel free to share your views.

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