IRCTC Q2 Results Preview: Modest Revenue Growth Expected and Investors Eye Dividend Announcement

The Indian Railway Catering and Tourism Corporation (IRCTC), which provides railway ticketing and catering services, is scheduled to announce its financial results for the second quarter of FY25 today. Along with the results, the IRCTC board will also discuss an interim dividend for the financial year.

The company has set Thursday, November 14, 2024, as the Record Date to determine which shareholders are eligible to receive the interim dividend if it is declared.

Analysts are predicting that IRCTC will see a slight growth in both revenue and profit for the quarter that ended in September 2024. They expect revenue from operations to increase by over 4% year-on-year (YoY) to approximately ₹1,170 crore, while the net profit is projected to rise nearly 7% YoY.

Anshul Jain, Head of Research at Lakshmishree Investments and Securities, stated, “In addition to the financial results, the company is expected to declare an interim dividend for FY 2024-25, which will be a key point of interest during the board meeting.”

At the operational level, analysts forecast a 2% YoY increase in IRCTC’s Q2 EBITDA, although they expect the EBITDA margin to face some compression.

Key Highlights to Watch in IRCTC Q2 Results

Market participants will be paying attention to the effects of new initiatives introduced by IRCTC, including a reduction in the Advance Reservation Period (ARP) and the addition of a ticket booking option for Regional Rapid Transit Systems (RRTS) trains on the IRCTC platform.

Last month, IRCTC announced that it would cut the Advance Reservation Period from 120 days to 60 days. However, the company confirmed that there would be no change in the number of trains operating daily, meaning the capacity for reserved tickets will remain the same.

“Therefore, the reduction in the ARP should not affect IRCTC’s revenue from internet ticketing through convenience fees for e-tickets,” said the company.

IRCTC has launched several initiatives to improve its services and boost revenue. The cut in the ARP is aimed at reducing long waiting lists during busy travel seasons without impacting the overall revenue from ticketing.

Another significant development is IRCTC’s collaboration with the National Capital Region Transport Corporation (NCRTC) under the ‘One India – One Ticket’ initiative. This partnership aims to simplify the ticket booking process for RRTS and Indian Railways, enhancing travel convenience for passengers across the country.

IRCTC Share Price Update

IRCTC shares have struggled this year, declining over 10% in the past month, more than 15% in the last three months, and over 19% in the past six months. Year-to-date, the stock has fallen over 6%.

As of 9:20 AM, IRCTC shares were trading 1.64% lower at ₹818.30 each on the BSE.