InvestorQ : Can you tell me the details of the IRCTC IPO and whether I should be investing in the IRCTC IPO? How would you rate this IPO?
NISHA Nayak made post

Can you tell me the details of the IRCTC IPO and whether I should be investing in the IRCTC IPO? How would you rate this IPO?

Answer
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Mitali Bhutta answered.
2 years ago
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The IRCTC is owned by the government but comes under the administrative control of the Indian Railways and manages the support services for the Railways. The IRCTC IPO is part of the government’s plan to gradually monetize the value hidden in the subsidiaries of Indian Railways. The IPO opens on 30th September and the details of the IPO are as under.

Opens: 30 Sep, Monday
Closes: 3 Oct, Thursday
Price Band: Rs.315 to Rs.320
Discount (Retail & Employees): Rs.10 on the offer price
Bid Lot: 40 Equity Shares and in multiples thereafter
Shares offered: 2,01,60,000
Employee Reservation: 1,60,000
Issue Size: Approx. Rs.645 crore at upper Band
Allocation: QIB: 50%, HNI: 15%, Retail: 35%

The timing of the IPO clearly appears to be intended to ride the wave of optimism sweeping the market after the corporate tax cuts announced by the Finance Minister. This is not a fresh raising of funds but it is an offer for sale by the government. The government will sell nearly 2.016 crore shares representing 12.5% of the paid-up capital of the company. Post the issue, the government stake will reduce to 87.5%. Thus it will continue to be a majority-owned subsidiary of the government. For retail investors, the advantage is that they get an additional discount of Rs.10, which makes the issue relatively attractive for them.
However, there are certain risks that investors in the IRCTC IPO must be aware of.

Firstly, the IRCTC just operates with one client and that is the Indian Railways. Therefore, margins are likely to be extremely constricted. Secondly, the IRCTC solely supplies catering and ticketing services to the Indian Railways and has a major regulatory risk of concentration of markets. Secondly, Indian Railways has been looking to hive off its key activities as contracts to third parties. This could further constrain the operating breadth of IRCTC. Retail investors must be cautious while investing in the IPO.
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rhea Babu answered.
2 years ago
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Public sector company Indian Railway Catering and Tourism Corporation (IRCTC) has received an overwhelming response from investors on the final day of bidding (today- 3rd October) by oversubscription of over 111 times.
As per the online data, the IPO received bids of equity shares of nearly 225,29,43,280 that stands the IPO size of almost Rs. 2.016 crore shares.
The breakup of the total subscriber goes like this (estimated) -
Qualified Institutional Investors subscribed- 108.79 times
Non-Institutional Investors subscribed 354.51 times
Retail investors subscribed 14.36 times and employees 5.74 times.
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Aswini Chikkodi answered.
2 years ago
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State-owned, Indian Railway Catering and Tourism Corporation (IRCTC) received much positive response through its Initial Public Offer (IPO). The IPO was fully subscribed on October 1, 2019.
As per the report, the IPO was subscribed by 2.60 times. The total IPO bid of Rs 645 crore received the bids for nearly 5.26 crore equity shares out of the IPO size of about 2.016 crore shares. Among all the investors, the non-institutional investors exceeded by subscribing to 100% following to qualified institutional buyers 85% approx. and retail investors nearly by 5.80%.
The tentative dates of listing the IRCTC shares on both the exchanges is 14th October 2019.
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