During a meeting on Monday (29th May), Indian Railway Catering and Tourism Corporation Ltd (IRCTC) announced an impressive Q4 FY23 result, with a 30% rise in net profit by reaching ₹278.8 crore, which was ₹214 crore in the same quarter of the previous year. The company recommended a final dividend of ₹2 per share (100%) for FY23.
In Q4, IRCTC witnessed a 9% increase in profit after tax (PAT) on a sequential basis, reaching Rs 256 crore. Revenues also rose by 5% quarter-on-quarter, amounting to Rs 918 crore. These positive figures indicate the company’s ability to maintain a solid financial trajectory amidst challenging market conditions.
Departmental Growth of IRCTC
The company’s profitability was fueled by growth in the catering business and non-convenience income. Revenue from the catering business surged by 48.67% year-on-year growth. The revenue was about Rs 266 crore last year in the March quarter, but the same rise rose to Rs 396 crore.
Rail neer revenue increased by 34.35%, with Rs 73 crore gross. In Q4 FY22, it was about Rs 55 crore.
The company’s revenue from operations experienced a substantial surge of 40% year-on-year, reaching Rs 965 crore compared to Rs 691 crore in the corresponding quarter of the previous year.
On the other hand, Internet ticketing revenue marginal increased to ₹295.12 crore in Q4 FY23 from ₹292.82 crores in the previous fiscal’s Q4, while The State Teertha revenue significantly increased to ₹65.44 crore from ₹25.81 crore in Q4 FY22.
For the full fiscal year, Indian Railway Catering and Tourism Corporation Ltd achieved remarkable growth, recording a 52% increase in net profit at Rs 1,006 crore. Revenue from operations experienced a substantial surge of 88% in FY23, reaching Rs 3,541 crore. These impressive results highlight IRCTC’s resilience and success in capitalizing on emerging opportunities within the railway sector.
Despite a marginal increase in internet ticketing revenue, Indian Railway Catering and Tourism Corporation Ltd demonstrated effective operational management, resulting in positive financial performance and expanded revenue streams.
Expenses
In the fourth quarter of FY23, Indian Railway Catering and Tourism Corporation Ltd experienced a substantial increase in total expenses, which rose by 53% to Rs 655 crore from Rs 429 crore in the same period the previous year.
Despite the higher expenses, IRCTC attained an operating profit (EBITDA) of Rs 324.6 crore, reflecting a 16.5% year-on-year growth.
However, the EBITDA margin contracted to 33.6% in Q4 FY23, compared to 40.3% in Q4 FY22. This contraction indicates the importance of implementing effective cost management and optimization strategies to sustain profitability in the face of rising expenses.
For the financial year 2022-23, IRCTC has recommended a final dividend of Rs. 2. The final dividend is subject to shareholders’ approval in the upcoming Annual General Meeting.
This final dividend, in addition to the interim dividend of Rs. 3.50 per share declared by the Board of Directors in February 2023. The interim dividend has already been paid to the shareholders.
Also, IRCTC has declared a 100% dividend for its shareholders. This reflects the company’s commitment to providing value and rewarding its investors for their trust and support.
IRCTC’s positive financial results have resonated with investors, as reflected in its stock performance. On Monday, the company’s stock closed 3.55% higher at Rs 646 apiece on the National Stock Exchange (NSE). This upward trend indicates market confidence and optimism in IRCTC’s prospects.
To conclude, IRCTC’s Q4 and FY23 performance exemplify its strong growth trajectory and resilience in the railway industry. The company has demonstrated its ability to generate robust profits and achieve significant revenue growth. The declaration of a 100% dividend further underscores IRCTC’s commitment to rewarding its shareholders. With favourable market sentiment and a track record of success, IRCTC is well-positioned to continue its growth trajectory and contribute to developing the railway sector in India.
