IRCTC Share price: Buy at Rs 2030 with stop-loss of Rs 1930 and target of Rs 2200 | Key levels highlighted by Choice Broking

IRCTC Share price: Sumeet Bagadia, Executive Director, Research at Choice Broking says that IRCTC share should be bought in cash at Rs 2030 with stop loss of Rs 1930 and target of Rs 2200. On a daily Chart, the stock has given breakout of its major resistance level with volumes and made a new lifetime high at 2072.70 levels which is a bullish sign in the counter. IRCTC share price today is Rs 2027, trading flat.

Moreover, IRCTC Share price has been trading above 21* 50 DMA with a positive crossover which points out strength in the counter. Daily Momentum Indicator RSI is managing to sustain above 70 level which suggests further up rally in the counter. Hence, Sumeet is expecting a bullish view in IRCTC for the upside target of Rs 2200 levels. 

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IRCTC is the offered a monopolistic opportunity in online rail ticketing, sale of Packaged Drinking Water (PDW) and catering services (in Train as well as 600 stations) for Indian Railways. Contrary to most other monopolistic plays, IRCTC assures low pricing and high quality experience for its customer base. The ticketing business operational prowess has been proven as it has achieved massive 73% penetration in FY20 on internet booking (during Pandemic 90%+). Its PDW brand (Rail-Neer) sells water cheaper by 33% compared to other branded alternatives. Catering business exclusivity ensures quality, pricing and availability to travelers.

IRCTC is a Low risk business model:

As an administrative agency, IRCTC charges fixed mark-up or license fee to its third-party vendors in catering, PDW, hospitality segment and pass on IR their due share, based on predetermined ratio. In the Catering business, it clocked Revenue of about Rs. 10.4Bn in FY20 with near zero-risk on demand or food inflation as it outsources it to contractors. Rail-Neer profitability is healthy at 19% as IRCTC has confirmed demand; no marketing spends and scale advantage (lead distance on distribution to reduce). Tourism biz has a fixed mark-up on aggregation and leverages its IRCTC brand and portal for leads, saving on marketing spends. In the ticketing business there is complete exclusivity for IRCTC. The only risky business is that of being a Train Operator (13% of rev) that functions on occupancy risk.