Mumbai, Sep. 28 (IANS): Come Monday, Indian Railway Catering and Tourism Corporation (IRCTC), a subsidiary of the Indian Railways, will hit the market with the initial public offering (IPO), likely to be the largest of the IPOs issued by the IR subsidieries, at INR 635-645 crore.
The IPO will open in a price band of Rs 315- INR 320 per share. The issue comprises an offer for sale of 2,01,60,000 shares of INR 10 face value. Of this, 1,60,000 shares are reserved for employees.
The minimum bid lot is 40 shares. Thus, orders can be placed in the multiple of 40 equity shares. The IPO proceeds will go directly to the government.
The total share dilution amounts to 12.60 per cent of IRCTC's paid-up equity share capital.
IRCTC, a profit making entity of Indian Railways, reported INR 272.6 crore net profit in FY19 and INR 220.62 crore in FY18. The company's revenue grew to INR 1,867.88 crore in FY19 from INR 1,470.46 crore in FY18.
Three other Indian Railways subsidiaries to have come out with IPOs are: Rail Vikas Nigam Limited (RVNL), RITES (Rail India Technical and Economic Service) and IRCON (Indian Railway Construction Company Limited).
The size of RVNL's public offering was INR 477.11 crore, IRCON INR 466.93 crore and RITES INR 460.44 crore.
An IPO is a financial instrument through which an unlisted company offers shares to the public. The funds raised are used for various purposes, like working capital, debt repayment and acquisitions.
IRCTC provides catering services to railways, online railway ticketing and packaged drinking water at railway stations and trains in India.
It operates in four business segments -- Internet ticketing, catering, packaged drinking water and travel & tourism. It also does other businesses, including non-railway catering and services, like e-catering, executive lounges and budget hotels.
