IRCTC - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:15 pm

Fundamental Rating: 4.0

📊 Core Financials

• Revenue & Profit: Quarterly PAT improved from ₹330 Cr. to ₹338 Cr. (9.69% growth).
• Margins: Strong ROE (37.2%) and ROCE (49.0%) highlight excellent profitability and capital efficiency.
• Debt: Debt-to-equity ratio at 0.02 shows negligible leverage.
• Cash Flows: Dividend yield of 1.21% reflects consistent shareholder returns.

💹 Valuation Indicators

• P/E Ratio: 40.4 vs Industry PE of 39.9 → fairly valued, slightly above peers.
• P/B Ratio: Current Price ₹675 / Book Value ₹53.2 ≈ 12.7 (premium valuation).
• PEG Ratio: 1.64 → moderately expensive relative to growth.
• Intrinsic Value: Fairly valued, supported by strong earnings and monopoly-like business model.

🏢 Business Model & Competitive Advantage

• IRCTC operates as the sole authorized online ticketing and catering service provider for Indian Railways.
• Monopoly position ensures consistent demand and strong pricing power.
• Asset-light model with high margins and strong scalability.

📈 Entry Zone & Long-Term Guidance

• Entry Zone: Attractive accumulation between ₹660–₹690.
• Long-Term Holding: Strong fundamentals, monopoly advantage, and high ROE make IRCTC a solid long-term compounder.

✅ Positive

• Debt-free company with strong ROE (37.2%) and ROCE (49.0%).
• Quarterly profit growth of 9.69%.
• Dividend yield of 1.21% supports investor confidence.

⚠️ Limitation

• High P/B ratio (12.7) indicates premium valuation.
• PEG ratio (1.64) suggests moderate overvaluation relative to growth.
• Weak technical momentum (RSI 34.0, MACD negative).

📉 Company Negative News

• Decline in FII holdings (-0.01%).
• Stock trading below DMA 200 (₹736), showing medium-term weakness.

📈 Company Positive News

• DII holdings increased (+0.02%).
• Quarterly profits improved.
• Strong monopoly position ensures long-term demand stability.

🏭 Industry

• Industry PE at 39.9 suggests IRCTC trades in line with peers.
• Travel and tourism sector benefits from rising demand and digital adoption.
• Peers face higher competition, while IRCTC enjoys monopoly advantage.

🔎 Conclusion

IRCTC is a fundamentally strong, debt-free company with exceptional ROE and ROCE.

Despite premium valuations on P/B and PEG ratios, its monopoly position and consistent profitability make it attractive for long-term investors.

Accumulation near ₹660–₹690 is recommended for those seeking stable growth and exposure to India’s expanding travel sector.