The Indian Railways’ ticketing, catering and tourism needs are met by the Indian Railway Catering and Tourism Corporation (IRCTC), a public sector enterprise in India. It was previously entirely owned by the Indian government and ran under the administrative supervision of the Ministry of Railways, but as of 2019, it has been listed on the National Stock Exchange and the Bombay Stock Exchange, with the government still holding a majority stake. IRCTC was incorporated in the year 1999. It is the only organization authorized to offer a variety of services to the Indian Railways apart from fooding like online ticketing and the sale of water on trains and at railway stations. The company was classified as Miniratna Public Corporation in the year 2008 which gave the organization some degree of financial freedom.
Toursim Industry in India
- India has a diverse ecology, geography and sites of natural beauty distributed throughout its 3,287,263 sq. km. total territory, which stretches from the snow-covered Himalayan heights to the tropical rain forests in the south. This offers a crucial chance to fully realize the tourism industry’s potential. India’s tourism industry has a lot of prospective since, like many other countries, it is a key source of foreign exchange for the country, however which decreased in 2020 as a result of the COVID-19 pandemic.
- In terms of the total contribution of travel and tourism to GDP in 2019, India is ranked 10th out of 185 nations by the World Travel & Tourism Council. The GDP contribution of travel and tourism in 2019 was US$ 194.30 billion, or 6.8% of the entire economy. 8% of all employment in India in 2020, were related to the tourism industry. By 2028, the contribution of the sector is anticipated to rise to 512 billion dollars (approximately).
- The Indian hotel market, which includes domestic, international and outbound travel, was estimated to be worth US$ 32 billion in FY20 and is anticipated to grow to US$ 52 billion by FY27, thanks to rising traveller demand and persistent market expansion by travel agencies. International visitors are anticipated to total 30.5 billion by 2028, bringing in more than $59 billion in revenue (approximately).
- The government has budgeted US$30.25 million under Budget 2023–24 for the creation of religious tourist circuits under PRASHAD yojana. Since its debut in January 2015, the Ministry has approved 37 projects in 24 states totalling US$ 146.4 million in expected spending. In the Union Budget 2023 – 24, US $ 290.64 million was allotted to Ministry of Tourism. Medical Tourism is expected to rise at a CAGR of 2.1% from 2020 -27. FDI to the sector is around US$ 16.48 billion in the year 2022 (approx.)
- The sector anticipates the growth of the e-Visa program, which is projected to treble foreign tourist arrivals in India. According to a joint study by Assocham and Yes Bank, India’s travel and tourism sector has the potential to grow by 2.5% as a result of increased budgetary allocation and affordable healthcare options.
- There is no denying that the tourism sector is growing in importance and has the potential to be a tool for growth. The tourism sector not only promotes growth but also increases living standards by offering a sizable number of various employment opportunities. It encourages environmental protection, defends different cultural heritage and supports world peace.
Company Perspective and Review
- Indian Railway Catering and Tourism Corporation (IRCTC), the online railway ticket-booking services provider, announced its March 2023 results for fiscal 2022-23 to be Rs.1006 crore and is debt free.
- Analysts had expected decent growth in earnings for the company with estimated net profit rising consecutively on a YoY basis. The company has paid continuous dividend. The Pivot Point of the scrip is around 660. The Moving Averages of the scrip gives a BUY signal and is expected to give good return to investors.