IRCTC convenience fee sharing roll back: Zee Business thanks Govt, DIPAM for withdrawing decision after appeal in shareholders' interest

Zee Business in its appeal to the government had requested to roll back the decision of sharing the convenience fee of IRCTC with the Ministry of Railways. And, now finally the decision has been taken back. Earlier on October 28, the Railways Ministry had announced that half of the revenue coming from IRCTC's Convenience Fee would be shared 50 per cent with the Railways Ministry from November 1, 2021 

On the back of this announcement, the company’s stock plunged during the early hours of the trading session on Friday. The counter in the early morning trade plunged more than 40 per cent to Rs 650 per share on the BSE.  

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Zee Business Managing Editor Anil Singhvi termed the government’s Convenience Fee sharing announcement as a hasty decision and said that it is necessary to change it. He had expressed optimism that eventually DIPAM will take the right decision on this matter. 

However, after Railways Ministry withdrew its decision of Convenience Fee sharing, the stock saw a recovery to end at over 7 per cent to Rs 845.65 per share on Friday. 

Singhvi says that the government had taken this decision in haste, which was not right from the point of view of investors. 

Despite maximum intraday fall in the stock, the managing editor advised investors to stay in the stock. He adds, the convenience fee is the main source of income for the company.

Last year, the company's revenue from convenience fee was Rs 300 crore, despite restrictions of lockdown. 

Analyst Rakesh Bansal says that after a big fall in the stock today, there has been a good recovery. Today, the neckline of Rs 800 apiece broke, after which reversal is being seen in the stock. There is support on the downside at Rs 800 apiece and resistance from Rs 917 to Rs 918 per share. 

DIPAM secretary Tuhin Kanta Pandey told Zee Business that the government has thoroughly reviewed the interests of investors. After which the decision to take 50 percent of the convenience fee has been withdrawn.  

“We take full care of investors in case of any listed company. At the same time, every case is reviewed from the market point of view. After which the government takes a decision,
 Pandey said.