IRCTC share price deep in red, despite trimming intra-day losses; Govt withdraws revenue share order

IRCTC share price recovered some of its losses on Friday morning after Secretary of Department of Invesment and Public Management said that the order to share convenience fee has been withdrawn. However, the stock was still in the red. IRCTC stock had nosedived more than 20% during the initial hours of trade. It was still down around 6% at 1:30 PM trading at Rs 860 per share. Indian Railways Catering and Tourism Corporation (IRCTC) on Thursday announced that the government has asked it to share 50% of the convenience fees revenue with the Ministry of Railways starting 1 November 2021.

“Ministry of Railways has decided to withdraw the decision on IRCTC convenience fee,” DIPAM Secretary’s Twitter handle tweeted on Friday. The revenue sharing could have cut the company’s earnings by as much as 36%, according to some estimates.

IRCTC’s main source of revenue and earnings goes for a toss