Indian Railway Catering and Tourism Corporation Ltd or IRCTC stocks cracked 5 per cent on NSE today, December 15, as the government sales its stake in the company via Offer for Sale (OFS). The divestment in the state-run company via OFS for non-retail investors began today.
The government will sell 5 per cent shares in IRCTC at a floor price of Rs 680. It currently holds 67.4 per cent stake in the company.
Government will sell its 2.5 per cent stake on Thursday (T day). On 16 December (T+1 day) it will sell 2.5 per cent stake. The government will sell its share via OFS where 2.5 per cent shares will be sold through green shoe option.
IRCTC shares were trading at Rs 701 on the NSE and were down by Rs 33.70 4.59 per cent around 10 am. Around 42 lakh shares were on the block on NSE around this time.
IRCTC stock has been moving sideways and the current chart structure does not suggest any strong trend, technical analyst Nilesh Jain said. The stock has been out of action over the last 5-6 months, he added.
The stock hit its 52-week high of Rs 918.65 on 17 January, 2022 and hit 52-week low of Rs 557 within a span of six months.
The current levels offer a good entry point for long term investors, Jain said, who is Assistant Vice President - Lead Derivative and Technical Research at Centrum Broking. It has a strong support between Rs 680 and Rs 670. Investors could look to buy this stock at Rs 685 with a stop loss of Rs 665, he further said.
As for traders, waiting is advised for better risk to reward ratio, the Centrum Broking analyst said. The stock could test target of Rs 720 and Rs 740 in the December series.
IRCTC has underperformed the Nifty50 index by over 25 per cent according to data sourced from Trendlyne. It has give negative returns of 17 per cent against 7 per cent returns given by Nifty.