IRCTC shares: Check the new target price post Q1 earnings

Shares of IRCTC were trading lower today a day after the state-owned firm reported a 196 per cent surge in its net profit for the quarter ended June 2022. IRCTC stock fell 0.95 per cent to Rs 666.70 today against the previous close of Rs 673.10 on BSE. The large cap stock has fallen after three days of consecutive gain.

It opened 2.66 per cent higher at Rs 691. The stock further rose 2.71 per cent to Rs 691.35. Subsequently, it saw profit-booking and fell to an intraday low of Rs 651.65, losing 3.19 per cent on BSE.

Shares of the firm are trading higher than the 5-day, 20-day and 50-day moving averages but lower than 100-day and 200-day moving averages. The stock has lost 20 per cent in 2022 but risen 29.48 per cent in a year.

Market cap of IRCTC fell to Rs 53,240 crore on BSE. Total 2.27 lakh shares of the firm changed hands amounting to a turnover of Rs 15.23 crore.

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The firm that provides ticketing, catering, and tourism services for the Indian Railways reported a profit of Rs 246 crore, for the quarter ended June 30. It reported net profit of Rs 82.5 crore in the year-ago period (Q1 FY22).

Revenue from operations rose 251 per cent to Rs 853 crore in Q1 this fiscal from Rs 243 crore in Q1 FY22.

Total income rose to Rs 877 crore in Q1 FY23 as compared to Rs 258 crore in Q1 FY22.

ALSO READ: IRCTC net profit jumps 196% in June quarter; revenue zooms 251%

Jinesh Joshi - Research Analyst, Prabhudas Lilladher said, "All the segments were Earnings before interest and taxes (EBIT) positive. Tourism achieved EBIT breakeven for the first time since pandemic at 1.1 per cent margin. EBITDA rose 187. 8 per cent YoY to Rs 320.9 crore (PLe Rs 300 crore) with a margin of 37.6 per cent  (PLe of 41.5 per cent) as against 45.8 per cent in 1QFY22. The stock currently trades at 54 times our FY24E EPS estimate of Rs 12.5. We currently have a HOLD rating on the stock with a target price of Rs 649."

Pavitraa Shetty, Co-founder & Trainer, Tips2Trades said, "Despite strong Q1FY23 earnings, it is advisable for investors to currently book profits in IRCTC stock as the results have already been factored in coupled with technically being overbought on the charts.  Rs 700 remains a strong resistance.  Rs 652 which is a strong support now, if broken on daily basis will lead to a much-needed correction till Rs 590- Rs 600."

Tirthankar Das, Technical & Derivative Analyst, Retail, Ashika Stock Broking said, "Prices provided the necessary breakout above the falling supply line, joining previous highs which contained amid the last nine months corrective decline, signaling extension of the current pullback from current levels thus offers fresh entry opportunity. Previously, the stock was seen on a base building mode at 61.8% retracement at Rs 640- Rs 650 of Nov'20-Oct'21 rally. Key observation being the breakout in relative strenghth index (RSI) seen in the daily time frame. The stock in the process closed above the 100 EMA currently placed at 663 levels. The ADX (currently placed at 20) shows bullish strength, though the negative directional indicator -DMI is still above the +DMI in weekly time frame. Presence of Harmonic 'White Swan Sea Pony' since the start of FY22 also indicates the same, a 161.8% retracement of B-C measures around 559. Hence, considering the overall chart structure it can be expected that stock has bottomed out around the key support zone of Rs 550- Rs 560 and upside potential for the stock is seen around Rs 770- Rs 775 (138.2% projected retracement of C-D)."

Manoj Dalmia, founder and director, Proficient Equities said, "IRCTC posted a 196 per cent rise in its net profit at Rs 246 crore for the quarter ended June 30, 2022-23 (Q1 FY23). It reported a net profit of Rs 82.5 crore in the year-ago period (Q1 FY22).The stock looks weak and technically investors can expect some short move on the upside. They can accumulate at current levels with long-term view."

Ravi Singhal, CEO, GCL said, "Margins have been under pressure, while revenue has increased significantly. So, in the medium term, the stock looks promising for a target of Rs 820 with a stop loss of Rs 719."

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