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Check Before You Invest : Indian Railway Catering And Tourism Corporation Ltd

BSE: 542830 NSE: IRCTC ISIN: INE335Y01020
  |   Sector:  Travel & Hospitality   |   Industry:  Travel Services

Snapshot

Q.1 Which industry/sub-sector does Indian Railway Catering And Tourism Corporation Ltd belong to?
Indian Railway Catering And Tourism Corporation Ltd belongs to the Travel & Hospitality sector, operating specifically within the Travel Services segment.
Q.2 Is Indian Railway Catering And Tourism Corporation Ltd a good quality company?
Indian Railway Catering And Tourism Corporation Ltd is a average quality company, based on a somewhat consistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Indian Railway Catering And Tourism Corporation Ltd undervalued or overvalued?
Indian Railway Catering And Tourism Corporation Ltd appears Somewhat overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 3-year
Historic Median
Price to Earnings 29.58 46.60
Price to Book 9.06 14.17
Price to Sales 8.39 12.00
EV to EBITDA 20.56 30.06
Q.4 Is Indian Railway Catering And Tourism Corporation Ltd a good buy now?
Indian Railway Catering And Tourism Corporation Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

Q.1 Gross Profit margin of Indian Railway Catering And Tourism Corporation Ltd?
Indian Railway Catering And Tourism Corporation Ltd Gross profit margin which is the profit after deduction of direct costs, is 37.7% for FY-2025, which is in line with its 3-year median of 37.8%, indicating stable margins.

Q.2 Operating Profit Margin of Indian Railway Catering And Tourism Corporation Ltd?
Indian Railway Catering And Tourism Corporation Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 33.17% for FY-2025, which is in line with its 3-year median of 34.41% indicating stable margins.

Q.3 Net Profit Margin of Indian Railway Catering And Tourism Corporation Ltd?
Indian Railway Catering And Tourism Corporation Ltd Net Profit Margin is 28.13% for FY-2025, is in line with its 3-year median of 28.13%, indicating stable margins.
Current Level 3-year
Historic Median
Gross Profit Margin (%) 37.7 37.8
Operating Profit Margin (%) 33.17 34.41
Net Profit Margin (%) 28.13 28.13

B: Does the business utilize capital efficiently?

Q.4 Return on Asset of Indian Railway Catering And Tourism Corporation Ltd?
Indian Railway Catering And Tourism Corporation Ltd Return on Asset is 19.62%, which is in line with its 3-year historical median of 19.03%, indicating stable asset utilization efficiency.

Q.5 Return on capital employed (ROCE) of Indian Railway Catering And Tourism Corporation Ltd?
Indian Railway Catering And Tourism Corporation Ltd Return on capital employed is 51.48% for FY-2025, which is in line with its 3-year historical median of 53.07%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Q.6 Return on Equity (ROE) of Indian Railway Catering And Tourism Corporation Ltd?
Indian Railway Catering And Tourism Corporation Ltd Return on equity is 38.15% for FY-2025, which is in line with its 3-year historical median of 38.93%, indicating the business is making similar use of its shareholders capital.

C: How much debt does the business have and is it at a sustainable level?

Q.7 Debt to Equity ratio of Indian Railway Catering And Tourism Corporation Ltd?
Indian Railway Catering And Tourism Corporation Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.07, indicating lower debt levels in the industry.

Q.8 Debt to cash flow from operations of Indian Railway Catering And Tourism Corporation Ltd?
Indian Railway Catering And Tourism Corporation Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Indian Railway Catering And Tourism Corporation Ltd?

Q.1 Promoter shareholding and pledge status of Indian Railway Catering And Tourism Corporation Ltd?
Promoters hold 62.40% of the Indian Railway Catering And Tourism Corporation Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Indian Railway Catering And Tourism Corporation Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Indian Railway Catering And Tourism Corporation Ltd vs industry peers?
Indian Railway Catering And Tourism Corporation Ltd revenue CAGR is 0.00%, compared to the industry median CAGR of 0.00%, indicating stable growth and maintaining its market share.
Profit Metrics
Current Level 3-year
Industry Median
Revenue Growth (%) - 0
Gross Profit Growth (%) 9.3 -
Operating Profit Growth (%) 5.7 -
Net Profit Growth (%) 18.4 -
Operating Efficiency
Current Level 3-year
Industry Median
Asset Turnover (x) 0.7 0.7
ROE (%) 38.15 38.93
ROCE (%) 51.48 53.07
Cash Conversion Cycle (days) -53.53 -54

Valuation & price assessment

Q.1 Stock return of Indian Railway Catering And Tourism Corporation Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 7.51% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- 7.5% -5% -31.4%
Q.2 Valuation ratios of Indian Railway Catering And Tourism Corporation Ltd vs historical?
The current P/E ratio of 29.58 is lower than its historical median of 46.60, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 3-year historical median and industry numbers?
Valuation Ratios Current 3-year
Historic Median
3-year
Industry Median
Price to Earnings 29.58 46.60 39.59
Price to Book 9.06 14.17 2.59
Price to Sales 8.39 12.00 2.14
EV to EBITDA 20.56 30.06 13.25

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