IRCTC shares dropped over 2% on February 12, 2025, hitting a fresh 52-week low of ₹731 per share following the release of its Q3 FY25 results. Despite strong financial performance, the stock witnessed selling pressure, raising questions about its potential as a buying opportunity for investors.
IRCTC Q3 FY25 Performance Highlights
Revenue Growth:
- Revenue rose 10% YoY to ₹1,224.7 crore compared to ₹1,115.5 crore in the same quarter last year.
EBITDA and Margins:
- EBITDA increased by 5.7% YoY to ₹417 crore, up from ₹394 crore.
- EBITDA margin slightly declined to 34% from 35.3% due to rising operational costs.
Net Profit Growth:
- IRCTC reported a net profit of ₹341 crore in Q3 FY25, marking a 13.7% YoY increase from ₹300 crore in Q3 FY24.
Dividend Announcement:
- The Board approved a second interim dividend of ₹3 per share for FY25, with a record date set for February 20.
Should You Buy IRCTC Shares Now?
Reasons to Consider Buying:
Strong Fundamentals: IRCTC's consistent revenue and profit growth signal a healthy business model.
Dividend Yield: Regular dividend payouts make it an attractive option for income-focused investors.
Sector Leadership: As the exclusive catering and ticketing service provider for Indian Railways, IRCTC enjoys a positive position in its sector
Risks to Keep an Eye on:
Margin Pressures: Rising operational costs and slight EBITDA margin contraction may impact profitability.
Market Sentiment: Broader market trends and external factors, such as interest rate movements or economic slowdowns, could weigh on the stock.
Summary
IRCTC's strong financials and strategic role in the railway sector make it a compelling long-term investment. Despite margin pressures, its growth potential and steady dividends offer stability. While short-term traders may benefit from a technical rebound, long-term investors could see value in the current dip
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