The state-owned Indian Railway Catering and Tourism Corporation (IRCTC), a subsidiary of Indian Railways, will enter the market today with its first public offering (IPO). This will probably be the largest public offering issued by IR subsidiaries at Rore 635-645 crore.
IPO is a financial instrument through which a non-listed company offers shares in public. The funds raised are used for various purposes, such as working capital, debt repayment and acquisitions.
Here are the details of the IPO:
- According to media reports, IRCTC, a subsidiary of Indian Railways, has set a price range for its first share sale offer in the amount of 315 to 320 RU per share.
- The issue includes an offer to sell 21.60,000 shares with a nominal value of 10 Rs. Of this, 1,60,000 shares are reserved for employees
- The minimum offer lot is 40 equity, followed by a multiple of 40 equity
- Proceeds from the IPO will go directly to the government
- The total dilution of shares is 12.60 percent of the paid-up IRCTC share capital
- The government plans to increase to crs Rs 645 in the price range through the IPO, which will end on October 3
- Last month, IRCTC submitted draft documents to the Securities and Exchange Board of India (SEBI) market regulator on the occasion of its IPO
- The managers of the offer are IDBI Capital Markets & Securities, SBI Capital Markets and YES Securities (India).
IRCTC operates one of the most-frequently concluded websites (www.irctc.co.in) in the Asia-Pacific region, with an average transaction size of 2.5 to 2.8 crore transactions per month during the 5 months ended August 31.
IRCTC, an income company of Indian Railways, recorded a net profit of 272.6 Rore in financial year 19, and in R18 of Rs 220.62. The company's revenues increased to 187.88 crore Rs in budget year 19 from 1,470.46 crore Rs in budget year 18.
IRCTC is the only entity authorized by Indian Railways to provide railway gastronomy services, online train tickets and packaged drinking water at railway stations and trains in India, in accordance with the draft Investigation Prospectus (DRHP).
The company's DRHP reported that IRCTC generated 1957 Rs crore revenues in financial year 19, an increase of 25 percent over the previous fiscal year. The power supply's net profit jumped 23.5 percent compared to 272.60 Rore crore during the 2019 tax year.
Currently, IRCTC operates in four business segments, namely: ticket sales via the Internet, catering, packaged drinking water under the "Rail Neer" brand as well as travel and tourism.
Earlier this year, IRCTC launched its own payment aggregation system, IRCTC iPay, to provide passengers using travel-related online services via the IRCTC website for online digital payments.
IRCTC has also diversified other companies, including off-road catering and services such as e-catering, executive salons and budget hotels.
Mahendra Pratap Mall, President and Managing Director of IRCTC, said online ticket sales now account for 12-13 percent of revenues and a margin of around 60-65 percent. CNBC-TV18.
CPSE has also diversified other business segments, such as e-catering, executive salons and affordable hotels.
Three other Indian Railways subsidiaries that have launched a public offering are: Rail Vikas Nigam Limited (RVNL), RITES (Rail India Technical and Economic Service) and IRCON (Indian Railway Construction Company Limited) IANS.
The size of the public offering of RVNL was Rs 477.11 crore, IRCON Rs 466.93 crore and RITES Rs 460.44 crore.
– With the agency's contribution