IRCTC: Railway Stock Nears 52-Week High, Breakout Performance Hints For More Upside Ahead, Likely By 22%

Indian Railways catering services provider, IRCTC's share price after crossing the Rs 700 mark earlier this month, has made a significant breakout on exchanges. The stock has floated over its psychological mark and on December 6th it even neared its 52-week high level. This dividend-paying railway stock has more upside potential, as brokerage Angel One stated that the target price is set at Rs 900 on IRCTC.

On BSE, IRCTC's share price ended at Rs 740.50 apiece on Wednesday, up by a whopping 3.6% with a market cap of Rs 59,240 crore. During the trading hours, the stock neared Rs 750 levels by touching an intraday high of Rs 749.75 apiece. This would be a couple of rupees away from hitting its 52-week high of Rs 758.10 apiece on the exchange. Also, this robust performance comes after the midcap stock witnessed a correction in the previous session.

In its latest report, Angel One said, that beyond its monopoly in these crucial segments, what's truly catching attention is the recent performance of IRCTC Ltd.'s stock. After a period of consolidation within the price range of Rs 758 to Rs 635.55, the stock has embarked on an impressive journey characterized by a continuation price pattern. This pattern, coupled with support from short-term key moving averages and the 61.8 per cent Fibonacci retracement level from a prior rally, suggests potential growth on the horizon.

Further fuelling the optimism is the 14-day Relative Strength Index (RSI) standing in the bullish zone at 64, indicating favourable momentum. With an envisioned target of approximately Rs 900, signifying a potential gain of over 25% from the breakout point, IRCTC Ltd. is now drawing the interest of both swing traders and investors, as per Angel One.

"Amidst its flourishing performance in the current market landscape, IRCTC Ltd emerges as a compelling opportunity for those seeking growth potential within the railway sector. Investors are advised to maintain a vigilant eye on its performance as it sets the stage for a promising journey ahead," the brokerage said.

Last month, IRCTC shares turned ex-dividend for an interim dividend of Rs 2.50 per share on a face value of Rs 2 each for FY24. In percentage terms, the dividend payout is 125% and in value terms, it is to the tune of Rs 160 crore. Since February 2020, IRCTC has declared 8 dividends so far, as per Trendlyne data. Currently, the stock has a dividend yield of 1.08%.

During Q2 of FY24, the 24-year-old Miniratna reported a net profit of Rs 294.67 crores, marking an increase of 30.36% from Rs 226.03 crores in Q2 of FY 2022-23. The net profit registered is the highest-ever profit registered by IRCTC in the history of IRCTC for this Quarter.

Further, in the quarter, the PSU registered a strong financial performance with an increase in total revenue of 23.51% which stood at Rs 995.31 crores in the September Quarter of FY 2023-24 in comparison to Rs 805.80 crores in Q2 of FY 2022-23. Both EBITDA and PAT ended up at healthy margins of 28.54% and 30.36% respectively.

IRCTC has always prioritized open communication and disclosure to our stakeholders. This UFR demonstrates our dedication to providing investors, clients, and partners with a clear understanding of our financial health and our strategic direction.

Disclaimer:

The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.