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Journalism of Courage
In a boost to the government’s disinvestment plan, state-owned Indian Railway Catering & Tourism Corporation (IRCTC) Monday made a blockbuster debut on the stock exchanges, zooming 128 per cent to close at Rs 728.60 as against the issue price of Rs 320. The Centre has set a target of mopping up Rs 1.05 lakh crore from divestment this fiscal and has lined up a number of PSUs for divestment. IRCTC’s stellar listing is the first of a government-owned entity this fiscal.
The company, a subsidiary of the Railways, made a dream stock market listing at Rs 644, a jump of 101.25 per cent, rallied to Rs 743.80 and closed at Rs 728.60 on the BSE. The stock did not fall below Rs 625 during the trade. The market capitalisation of IRCTC on the listing day was Rs 11,657 crore.
According to analysts, this is the best IPO show and also arguably the best debut after Salasar Engineering in July 2017 which had rallied 142 per cent on opening trade and Avenue Supermarts which runs the D-Mart chain of retail stores also closed over 100 percent up on debut. The last time a government company received such a welcome from the market was when it sold 12 per cent in Coal India in October 2010. It was listed at Rs 340 as against the issue price of Rs 245.
IRCTC Chairman-Managing Director Mahendra Pratap Mall said he was overwhelmed with the response the firm received. “We have more than doubled the wealth of investors. This showcases the trust of our customers and stakeholders on the brand called IRCTC and the services it provides. The investor demand exceeded shares on offer by 112 times, making us the most sought after state-run firm,” he said.
“With the company’s diversification plans for future and growing services across categories, IRCTC aims to stand out as a full-service hospitality and tourism brand of India,” he said. The initial public offering of IRCTC, a huge hit among investors, was subscribed 111.91 times earlier this month.
As part of its strategy to diversify its business offerings, IRCTC plans to develop budget hotels in key tourist destinations. On October 4, IRCTC flagged off its first privately run train Tejas Express on the Lucknow-Delhi route.
