Shares of Indian Railway Catering and Tourism Corporation (IRCTC), the flagship tourism and ticketing arm of Indian Railways, are back in focus after the company announced its Q4FY26 earnings. Following the quarterly results, brokerage firm Prabhudas Lilladher (PL Capital) reiterated its ‘BUY’ rating on the stock and projected a strong upside potential for investors.
Although the company reported healthy revenue growth during the March quarter, pressure on margins and profitability prevented the results from fully meeting market expectations.
IRCTC Q4 Results: Revenue Rises 15%, But Margins Decline
According to PL Capital’s latest report, IRCTC posted total revenue of ₹14,597 million during the fourth quarter of FY26, reflecting a strong year-on-year growth of 15.1%.
However, the company’s EBITDA margin narrowed sharply from 30.4% in the same quarter last year to 27.3% this quarter. The brokerage attributed this decline primarily to:
CSR expenditure of ₹310 million
Expected Credit Loss (ECL) provisioning worth ₹160 million
Meanwhile, the company’s reported net profit (PAT) fell 8.9% year-on-year to ₹3,264 million, disappointing some investors despite strong topline growth.
Catering Business Emerges as Biggest Growth Driver
Among IRCTC’s various business verticals, the Catering segment delivered the strongest performance during the quarter.
Segment-Wise Performance
Catering Revenue: Up 26.7% YoY
Internet Ticketing Growth: Increased 4.8%
EBIT Margin in Ticketing: Strong at 76.3%
Rail Neer Revenue: Rose 4.4%
Tourism Segment: Grew 10.6%
The report further highlighted that IRCTC is actively expanding the production capacity of its Rail Neer plants located at Danapur and Ambernath to support future demand growth.
UPI Boom Strengthens IRCTC’s Digital Ecosystem
IRCTC also witnessed strong momentum in digital ticket bookings during the quarter. Around 134 million tickets were booked in Q4FY26, showcasing continued growth in railway e-ticketing demand across India.
The rise of UPI-based transactions remained one of the biggest highlights:
UPI contribution in ticket bookings surged to 51.7%
Last year’s corresponding figure stood at 46.3%
E-booking penetration remained extremely high at 89%
Analysts believe this trend aligns strongly with India’s rapidly expanding digital payments ecosystem under the ‘Digital India’ initiative.
PL Capital Revises IRCTC Share Price Target
Despite maintaining a bullish stance on the stock, PL Capital slightly revised its target price downward due to slower-than-expected recovery in margins.
Previous Target Price: ₹850
Revised Target Price: ₹712
Rating Maintained: BUY
The brokerage believes the stock still offers meaningful upside potential over current levels, supported by IRCTC’s monopoly-like business model, strong digital presence, expanding catering operations, and stable railway-linked growth prospects.
Why Analysts Remain Positive on IRCTC
Market experts believe IRCTC continues to remain one of the strongest PSU-linked consumer-facing businesses in India due to several key advantages:
Monopoly in railway e-ticketing
Strong cash-generating business model
Rapid digital payment adoption
Expanding packaged drinking water business
Growth in railway tourism and catering services
Although margin pressure remains a short-term concern, analysts expect operational efficiencies and scaling benefits to improve profitability over the coming quarters.
With railway modernization and digital booking penetration continuing to rise in India, IRCTC remains one of the most closely watched PSU stocks in the market.
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