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IRCTC shares tank below ₹4,000 in day's low. A 'buy on dip' opportunity?

IRCTC is in a pure monopoly business as it is the only authorized firm to provide online tickets and catering services to the Indian Railways

1 min read . Updated: 25 Oct 2021, 12:10 PM IST Livemint

IRCTC share price was trading at around ₹4,091 apiece, down over 11% on the BSE in Monday's early deals

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Shares of Indian Railway Catering and Tourism Corporation (IRCTC) continued to trade with sharp cuts in Monday's trading session with the stock slipping below ₹4,000 per share mark intraday. IRCTC shares hit a day's low of ₹3960, however, bounced back a bit from lows as it was trading at ₹4,091 apiece, down over 11% on the BSE.

Shares of IRCTC have been among investors' favorite on the back of its pure monopoly business along with its robust financials as well as the company's debt-free status. IRCTC had entered the primary markets by listing in October 2019 and its stock has delivered stellar return to its shareholders since then. However, in the past few sessions that stock has struggled to keep up with its stellar rally.

“IRCTC is continuing its southward journey where it has slipped below 20-DMA of 4500 as it has come out of F&O ban and short traders tried it to drag more so that weak longs get out of the game however 4000-3700 is a strong demand zone where we can expect some relief rally but 20-DMA which is currently placed at 4500 will act as an immediate hurdle," said Santosh Meena, Head of Research, Swastika Investmart Ltd.

As per Meena, the long term outlook for the IRCTC stock is still bullish where investors can use the current dip as a buying opportunity, he suggested.

IRCTC shares have fallen over 34% in the past five trading sessions after hitting a record high of ₹6,393 apiece last Tuesday. Though, the scrip has given multibagger return of over 185% this year (year-to-date) so far, whereas it is up 139% in the last six months alone.

“IRCTC is on support on weekly time frame but one can look to buy with strict stop loss of 3,800 on closing basis and if said levels sustain, then we may see next bounce towards 4500 zone," said Rohit Singre, Senior Technical Analyst at LKP Securities.

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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