- IRCTC shares fell 2%
- IRCTC shares hit an all-time high of Rs 2,727.95 in the previous session
- IRCTC shares were trading down 1.2% at Rs 2,657 as of 1:55 p.m.
Shares of Indian Railway Catering and Tourism Corporation (IRCTC), the online ticketing, tourism and catering arm of Indian Railways, fell as much as 2% to hit an intraday low of 2,635.85 rupees on BSE. The decline in IRCTC’s share price is due to profit booking a day after hitting an all-time high of Rs 2,727.95 after announcing a 1:5 ratio stock split.
“The IRCTC Board has recommended the proposal to sub-divide or split one share of the company with a nominal value of Rs 10 each into five shares of capital with a nominal value of Rs 2 each,” the IRCTC said in a regulatory filing to the exchanges.
The authorized share capital of a company remains the same during a stock split, but the market price decreases in proportion to the split ratio, resulting in more shares available in the secondary market. The reduced market price and increased liquidity are making stocks affordable for retail buyers, analysts said.
Meanwhile, the IRCTC reported a net profit of Rs 82.52 crore, compared to a loss of Rs 24.60 crore in the corresponding quarter last year. IRCTC’s operating income stood at Rs 243 crore compared to Rs 131 crore in the same period last year, marking a growth of 85%.
IRCTC is a wholly owned subsidiary of Indian Railways and provides e-ticketing, sightseeing and catering services to passengers. The company was listed on the stock exchange in 2019 and the government holds a 67% stake in the company.
As of 1:55 p.m., IRCTC shares were trading down 1.2% at Rs 2,657, underperforming the Sensex which was up nearly 1%.