In a major development, the Ministry of Railways on Friday, October 29, has announced to withdraw the decision on Indian Railways Catering and Tourism Corporation (IRCTC) convenience fee. It was reversed within 19 hours after the massive fall in stock price.
However, it came to light that soon after the Secretary, Department of Investment and Public Asset Management announced withdrawal of 50 per cent convenience fee sharing, IRCTC staged a strong recovery in the market.
On Thursday, October 28, the Indian Railway Catering & Tourism Corporation Limited (IRCTC) announced that it will now share the revenue earned from convenience fees for bookings made on its platform in the ratio of 50: 50 with the Ministry of Railways. Following the IRCTC announcement, market experts are expecting a fall in the share prices of the state-owned firm that currently enjoys a dominating monopoly.
In an official statement, IRCTC said: "ln compliance with the Regulation 30 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,2015, it is to be informed that Ministry of Railways vide above-referred letter has conveyed its decision to share the revenue earned from convenience fee collected by IRCTC in the ratio of 50: 50 w.e.f 1 November 2021".
So far, the entire convenience fee went to IRCTC, as the ticketing system is run by it, while the rail fare went into the account of Indian Railways. The convenience fee is not part of the rail fare. It is for the service offered by IRCTC of booking a ticket on the web.
Indian Railways currently earns from a slew of sources, including the booking of tickets, catering services, packaged drinking water and food sold in trains and at several railway stations.
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