State-run Indian Railway Catering and Tourism Corporation’s (IRCTC) Initial Public Offering (IPO) was subscribed nearly 112 times on the final day, receiving bids worth ₹72,000 crores. The government is looking to raise ₹645 crores by selling a 12.5% stake in IRCTC. This is the first time that an IPO of a state-run company has been subscribed more than 100 times.
The overwhelming response comes amid slowing growth in Asia’s third-largest economy, which has hit sales of everything from cars to cookies, prompting the government to step in with deep cuts in corporate taxes and a raft of other measures to revive growth.
“IRCTC could see better valuation and a jump in EPS from second half of FY20 due to restoration of service charges which were halted after demonetization and the recently announced corporate tax rate cut,” said Deepak Jasani, head of retail research at HDFC Securities.
“It is also partly in the internet space and such companies are witnessing heightened investor interest.”
The company is authorized by the railway ministry to offer Indian railway tickets online, offer catering service and exclusively manufacture and supply packaged drinking water at railway stations and on trains in India.