The shares of Indian Railway Catering and Tourism Corporation (IRCTC) plunged on Friday morning on the back of a decision by the Ministry of Railways that it will share the revenue earned from convenience fee collected by the IRCTC in the ratio of 50:50 from November 1, 2021.
Sent for a toss, the company's scrip was trading at Rs 859.25, down almost 6 per cent, even as it recovered from the morning lows.
Within 19 hours after the massive fall in stock price, the the Ministry of Railways decided to withdraw its decision on sharing of convenience fee earned by IRCTC on online bookings of train tickets. IRCTC had collected ₹300 crores as 'convenience fee' in financial year 2020-21.
The Railway Ministry wanted IRCTC to share 50 per cent of this amount, which comes to ₹150 crores. For the last five years, IRCTC has been collecting and utilising all funds collected as convenience fee to run its operations. The state-owned IRCTC is the only firm authorised to manage food services on trains and has a monopoly in the online ticketing and catering services of the Indian Railways.
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