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Every year, the Union Budget sets the economic tone for India. The Union Budget 2026, presented on 1 February 2026, is especially significant as India balances fiscal discipline with growth ambitions in a rapidly evolving global economy.
For retail investors, traders, and long-term wealth creators, understanding the Budget is not about memorising numbers. It is about interpreting intent, direction, and opportunities. This blog breaks down the key expectations, sectoral impact, and how Indian markets typically react, in a practical and investor-friendly manner.
India enters 2026 with stable macro indicators but rising global uncertainties. Inflation moderation, strong domestic consumption, and improving corporate balance sheets provide a supportive backdrop.
However, challenges remain:
The Union Budget becomes a balancing act between growth support and fiscal responsibility, both closely watched by markets and regulators like SEBI and RBI.
The government is expected to continue its glide path towards fiscal consolidation while maintaining strong capital expenditure. Market participants closely track fiscal deficit numbers because they influence bond yields, liquidity, and equity valuations.
A controlled deficit signals stability and builds confidence among domestic and foreign investors.
Infrastructure remains a core theme. Roads, railways, urban development, and logistics are expected to receive sustained allocations.
Market impact example:
Historically, sectors like cement, capital goods, engineering, and PSU banks have reacted positively to higher capex announcements, as they benefit directly from project execution and credit growth.
The manufacturing ecosystem continues to be strengthened through policy support. Production-linked incentives, electronics manufacturing, defence, and renewable energy are likely focus areas.
For investors, this reinforces India’s long-term manufacturing story and supports sectors aligned with domestic production and exports.
India’s digital public infrastructure has gained global recognition. Union Budget 2026 is expected to deepen investments in AI, fintech innovation, and digital skilling.
Real-world relevance:
Fintech penetration, algorithmic trading, and tech-enabled investing platforms have already transformed how Indian investors participate in markets. Policy support further strengthens this ecosystem.
Large tax overhauls are unlikely, but incremental rationalisation is expected. Markets usually prefer predictability over sudden changes.
Possible focus areas include:
For retail investors, clarity in taxation improves confidence and long-term planning.
Budget Day volatility is normal. Markets often react in three phases:
For example, even if the index shows limited movement, individual stocks and sectors can see meaningful trends emerge post Budget.
Experienced investors focus less on day-one moves and more on medium-term opportunities aligned with policy direction.
Short-term volatility does not always reflect long-term value. Emotional trading around Budget speeches often leads to poor outcomes.
Sectors aligned with recurring government priorities tend to benefit over multiple years, not just one Budget.
Budget interpretation requires context, numbers, and historical understanding. This is where strong research-backed platforms add value.
At Swastika Investmart, investors benefit from SEBI-registered expertise, structured research tools, and timely insights that help decode such macro events without confusion.
SEBI continues to strengthen transparency, risk disclosures, and investor education. The Union Budget often complements this by supporting financial inclusion, digital investing, and awareness initiatives.
For investors, this means a safer, more structured environment to participate in capital markets.
Budgets do not create wealth overnight. They create frameworks. Investors who align portfolios with long-term economic direction often benefit more than those chasing short-term reactions.
Having access to reliable research, responsive customer support, and tech-enabled platforms becomes crucial in such phases.
Budgets generally create sector-specific opportunities rather than broad-based rallies. Long-term impact depends on execution and global conditions.
Infrastructure, manufacturing, capital goods, technology, and select financials are likely to remain in focus.
Trading on Budget Day is risky due to volatility. Informed investors usually wait for clarity and confirmation.
Yes. Policy direction influences earnings growth, sector leadership, and capital allocation over time.
By relying on research-driven insights, understanding macro trends, and avoiding impulsive decisions.
Union Budget 2026 reinforces India’s long-term growth narrative while maintaining fiscal prudence. For investors, the real opportunity lies not in reacting fast, but in aligning smartly.
Platforms like Swastika Investmart help investors navigate such events with confidence through SEBI-registered research, advanced tools, strong customer support, and a focus on investor education.
If you are looking to invest with clarity and discipline, now is a good time to get started.
Rating SUBSCRIBE
Issue Opens on Nov 15, 2021Issue Close on Nov 17, 2021Total IPO size (cr)1,023.47Fresh issue150.00Offer For Sale (cr)873.47Price Band (INR)635-662Market Lot22Face Value (INR)2Retail Allocation35%Listing On NSE, BSE
⮚ For Repayment/prepayment of liabilities ⮚ For Funding of the capital expenditure
QIB Portion50NIB Portion15Retail Portion35
Pre Issue5,09,40,420Post Issue5,32,06,281
Finalization of Basis of Allotment23-11-2021Refunds/Unblocking ASBA Fund24-11-2021Credit of equity shares to DP A/c25-11-2021Trading commences26-11-2021
Tarsons Products Limited is a Indian labware company engaged in the designing, development, manufacturing and marketing of ‘consumables’, ‘reusables’ and ‘others’ including benchtop equipment, used in various laboratories across research organizations, academia institutes, pharmaceutical companies, Contract Research Organizations (CROs), Diagnostic companies and hospitals.
Company’s product portfolio is classified into three key categories which include consumables, reusables, and others. ‘Consumables’ category includes products such as centrifuge ware, cryogenic ware, liquid handling, PCR consumables and petri dish, transfer pipettes and others. ‘Reusables’ category includes products such as bottles, carboys, beakers, measuring cylinders and tube racks. ‘Others’ category includes benchtop instrumentation such as vortex shakers, centrifuges pipettors and others. Company is one of the leading Indian company in terms of revenue in the plastic labware market in India
⮚ Company currently operates through their five manufacturing facilities located in West Bengal. These facilities are vertically integrated and equipped with automated support systems that help them to maintain quality, increase productivity, and reduce costs.
⮚ They have over 36 years of experience in life sciences through which they gained expertise in the production of a wide range of labware products.
⮚ Company have received CE-IVD certificate for their products such as micro and macro tips, cryo vials and centrifuge tubes.
⮚ Company supply their products to over 40 countries across both developed and emerging markets through a blend of branded and ODM sales.
⮚ They supply products to life sciences industry under the brand label‚ TARSONS WITH THE WORDS -TRUST DELIVEREDTM.
The company has shown stable growth in revenue in the last 3 years where we saw a minor dip in FY20 on the back of COVID-19. Revenue of the company has grown from Rs 184.7 cr to Rs 234.3 cr over the period of FY19 to FY21; during the same period profit has grown from Rs 39 cr in FY19 to Rs 68.9 cr in FY21.
The margins of the company have grown significantly on the back of declining debt. Tarson products limited is a company with great brand awareness and high-quality goods, India’s leading life sciences supplier.
The company aims to be debt fee post the IPO and is planning for CAPEX which will further increase the revenues. The IPO is arriving at a PE of 34x on annualized Q1FY22 EPS of Rs. 4.88 which seems to be attractively priced. Thus we assign a "SUBSCRIBE" rating for listing gain and long term.
⮚ Sanjive Sehgal is the Chairman and Managing Director of the Company. He holds a bachelor’s degree in science from Xavier College, Calcutta. He has over 30 years of experience in this Company.
⮚ Rohan Sehgal is the Whole-Time Director of the Company. He holds a bachelor’s degree in science (management) from the University of Manchester. He has over 7 years of experience in this Company.
⮚ Gaurav Podar is the Non-Executive Nominee Director of the Company. He has over 10 years of experience in the finance industry. He has been Non-Executive Nominee Director in this Company from June 10, 2019.
⮚ Viresh Oberai is the Independent Non-Executive Director of the Company. He holds a bachelor’s degree in history from the University of Delhi; He has over 22 years of experience with Tata Steel.
⮚ Sucharita Basu De is the Independent Director of the Company. She has over 20 years of experience in commercial and corporate agreements, capital markets and real estate.
⮚ Girish Vanvari is the Independent Director of the Company. He holds a bachelor’s degree in commerce from the University of Bombay and is a member of the Institute of Chartered Accountants of India.
⮚ Piyush Khater is the Company Secretary and Compliance Officer of the Company. He holds a bachelor’s degree in commerce with specialisation in accounting & finance from St. Xavier’s College, University of Calcutta. He has over 4 years of experience and has previously worked with Ashok Kumar Duggar & Associates. In his last position, he was assistant manager with Consolidated Consultancy Services Private Limited. Since he joined our Company on July 28, 2021, he did not receive any remuneration during the Financial Year 2021.
⮚ Santosh Agarwal is the Chief Financial Officer of the Company. He holds a bachelor’s degree in commerce from the University of Calcutta. He has over 20 years of experience and has previously worked with Polar Fans, Genpact, ICA group and Gruas Jaso Group. In his last position, he was the chief financial officer and company secretary of Jaso India. He joined the Company on October 1, 2019
⮚ Leading Indian supplier to life sciences sector with strong brand recognition and quality products.
⮚ Company provide a diverse range of labware products across varied customer segments
⮚ They operate in an industry which has a large addressable market with long-standing relationships with key end customers
⮚ Well-equipped and automated manufacturing facilities
⮚ Wide geographic reach through their pan India sales and distribution network
⮚ Experienced Promoter backed by strong management team
⮚ All manufacturing plants are based in West Bengal (Geographical risk).
⮚ Over 85% of the IPO proceeds would go to selling shareholders of the company.
⮚ Company imports over 75% of its raw materials. Any delay, interruption or reduction in supply of raw materials to manufacture its products can adversely affect its business.
⮚ Company’s manufacturing facilities are concentrated in West Bengal. Such geographical concentration can pose risk to its business.
⮚ In case of plastic products manufactured by the company gets banned in India or any markets where the company exports its products can have a material and adverse effect on its business.
As per the RHP document, there are no listed entities whose business portfolio is comparable with that of Tarsons’s business and hence we cannot conclude whether the issue price is underpriced or overpriced. However, the IPO is arriving at a PE of 34x on annualized Q1FY22 EPS of Rs. 4.88 which seems to be attractively priced.
FINANCIALS (RESTATED CONSOLIDATED)
Particulars (Rs. In Millions) FY 2021 FY 2020 FY 2019Equity Share Capital 1.92 2.00 1.92Other Equity 2,441.46 1,973.69 1,350.81Net Worth 2,443.38 1,975.69 1,352.73Total Borrowings 334.54 358.95 645.13Revenue from Operations 2,289.11 1,759.02 1,787.48EBITDA 1,034.38 692.54 716.67Profit Before Tax 924.34 531.33 558.25Net Profit for the year 688.70 405.31 389.58
The Smartphone Industry has been steadily developing and evolving; both, in terms of market size and varied models. Factors such as the rise in disposable income of individuals, the development of robust telecom infrastructure, the introduction of budget-centric smartphones, and the increasing number of product launches are collectively contributing to the holistic growth of the smartphone market.
Samsung topped the list of smartphone players with a market share of 19 per cent, followed by Apple with a 15 per cent of market share. Huawei stood third, holding 14 per cent of the market share. Xiaomi came in fourth on the list with an 11 per cent market share, followed by Oppo at 8 per cent, rest 33 per cent are held by other players in the market.
Of late, Samsung is the market leader that makes numerous best-selling Android phones, and with over 300 million sales a year, it is now the largest smartphone maker in the world. Keeping pace with advancing technology, Samsung also expanded its 5G smartphone lineup at entry and midrange price bracket of phones.
Right behind Samsung, there's Apple, an ultra-premium brand that offers flagship iOS-based smartphones, unlike other brands which are dealing in the Android OS.
China's stronghold in the world smartphone market can't be overlooked. Huawei is the largest smartphone manufacturer in China and the second-largest in the world, after South Korea’s Samsung. Huawei has a subsidiary brand, named 'Honor' that also designs and sells smartphones.
Xiaomi is another china's big giant emerging as one of the top leaders in the market with a mighty online customer base and fast expansion in the global markets beyond the Asian-Pacific region driven by investments via retail channels and partnerships with top communication services providers.
Another renowned china based smartphone maker 'Oppo' has grown tremendously by popular-priced mid-range smartphones, a wider distribution network, and robust marketing strategies in Western Europe.
Demand for smartphones continued to grow as users tilted towards higher specifications and a better user-friendly experience. The improvement in consumer outlook sustained learning, and work from home culture, along with pent-up demand from 2020, is also boosting sales of smartphones in 2021.
अमेरिका के उपभोक्ता मूल्य सूचकांक में साल-दर-साल वृद्धि सितंबर में 5.4 प्रतिशत की वृद्धि को पार कर गई है। सितंबर से लेकर अक्टूबर तक अमेरिका में, कीमतों में 0.9 प्रतिशत की वृद्धि हुई, जो जून के बाद से महीने-दर-महीने की उच्चतम वृद्धि है। कच्चे तेल, गैस और खाद्य सामग्री की बढ़ती लागत के कारण अमेरिकी उपभोक्ता मूल्य सूचकांक पिछले वर्ष की तुलना में अक्टूबर में 6.2 प्रतिशत पर पहुंच गया है। यूएस सीपीआई डेटा के अनुसार, जो यह मापता है कि उपभोक्ता वस्तुओं और सेवाओं के लिए कितना भुगतान करता है, बढ़कर 4.6 प्रतिशत हो गया है, जो कि संयुक्त राज्य अमेरिका (यूएस) में 1990 में देखी गई मुद्रास्फीति का उच्चतम स्तर है। जिसके कारण पिछले सप्ताह घरेलु वायदा सोना 1400 रुपये प्रति दस ग्राम और चांदी 3000 रुपये प्रति किलो तक तेज़ हुई है।
मुद्रास्फीति हाल के महीनों में श्रमिकों को मिलने वाले वेतन में मजबूत लाभ को कम कर रही है और राजनितिक मुश्किलें बढ़ा रही है। लगभग एक दशक पहले की बड़ी मंदी के बाद की तुलना में महामारी से उबरने के दौरान नौकरी और वेतन वृद्धि अधिक अच्छी रही है। लेकिन उस मंदी के बाद के वर्षों के विपरीत, मुद्रास्फीति अब तेजी से बढ़ रही है और अर्थव्यवस्था में विश्वास को कम कर रही है।
जिसके कारण निवेश के लिए सुरक्षित मांग बढ़ती जा रही है। खाद्यान्न, खाद्य तेल, धातु और बिजली आपूर्ति समेत आवश्यक वस्तुओं के दाम बढ़ने से और दुनिया भर में आपूर्ति बाधित होने से महंगाई बढ़ रही है। हालांकि, अमेरिकी फेड का मुद्रास्फीति लक्ष्य 2 प्रतिशत है जो पहले से ही इस स्तर से काफी ऊपर है लेकिन अर्थव्यवस्था की वर्तमान स्थिति के अनुसार और अधिक आर्थिक सुधारों की आवश्यकता है। अमेरिकी फेड और यूरोपीय सेंट्रल बैंक ने कहा है कि वे बांड खरीद को कम कर रहे हैं, लेकिन निकट अवधि में ब्याज दर में वृद्धि नहीं करने जा रहे हैं क्योंकि अर्थव्यवस्था को महामारी के कारण बिगड़ी हुई आर्थिक स्थिति से बाहर आने के लिए अधिक नौकरियों और प्रोत्साहन की आवश्यकता है।
इस सप्ताह सोने और चांदी के भाव तेज़ रह सकते है। दिसंबर वायदा सोने में 49700 रुपये पर प्रतिरोध और 48000 रुपये पर सपोर्ट है। चांदी में 69000 रुपये पर प्रतिरोध और 63500 रुपये पर सपोर्ट है।
RatingSubscribeIssue OfferIssue Opens on Nov 01, 2021Issue Close on Nov 03, 2021Total IPO size (cr) 125.43Fresh issue 125.43Offer For Sale (cr) NilPrice Band (INR) 161-163Market Lot 90Face Value (INR) 10Retail Allocation 35%Listing On NSE, BSEObjects of the issue ⮚ CAPEX of MCC at Dahej, Gujarat ⮚ CAPEX of MCC at Jhagadia, Gujarat ⮚ CAPEX of CCS at Kurnool ⮚ For General Corporate Purposes.Issue Break-up (%)QIB Portion 50NIB Portion 15Retail Portion 35Share Holding Pattern %Promoters & Promoter group 64.6 48.5Public 35.4 51.5Indicative TimetableFinalisation of Basis of Allotment 10-11-2021Refunds/Unblocking ASBA Fund 11-11-2021Credit of equity shares to DP A/c 12-11-2021Trading commences 15-11-2021
Sigachi Industries was incorporated as a private limited company in 1989, with the business to manufacture chlorinated paraffin and hydrochloric acid in its manufacturing unit situated at Hyderabad.
In the year 1990, Company diversified its product portfolio to manufacture microcrystalline cellulose which is widely used as an excipient for finished dosages in the pharmaceutical industry.
The inert non-reactive, free-flowing and versatile nature of MCC have varied applications in the pharmaceutical, food, nutraceuticals and cosmetic industries. The company manufactures MCC of various grades ranging from 15 microns to 250 microns.
The company had consistent revenue growth in the last 3 years where they grew at a CAGR of 13%. In FY21 revenue was at Rs 196 crore VS Rs 133 cr in FY19 while profit grew at CAGR of 17% and in FY21 net profit was Rs 30 cr Vs Rs 19 cr in FY19. The margins of the company are improving gradually. The CAPEX from the IPO would also help the company to increase its revenue further.
The Indian foods and beverage market, as well as the pharmaceutical market, are growing rapidly which should drive MCC’s demand forward.
Due to the small size of the IPO the company is going to list in the T2T Segment. The IPO is arriving at a PE of 14x on the average EPS of the last three years i.e. Rs. 10.88 and P/BV of 2.19 which seems to be reasonably priced for investors. Thus, we assign a “SUBSCRIBE” rating to the IPO for listing gains and long term.
IPO Note
SIGACHI INDUSTRIES LTD
IPO Note
SIGACHI INDUSTRIES LTD
COMPARISON WITH LISTED INDUSTRY PEERS
There are no listed companies in India that engage in a business similar to that of the Company. Accordingly, it is not possible to provide an industry comparison in relation to the Company. However, The IPO is arriving at a PE of 14x on the average EPS of the last three years i.e. Rs. 10.88 and P/BV of 2.19 which seems to be reasonably priced for investors.
FINANCIALS (RESTATED CONSOLIDATED)
Particulars (Rs. In Lacs) FY 2021 FY 2020 FY 2019Equity Share Capital 768.25 768.25 307.30Other Equity 8,651.69 5,690.27 4,180.97Net Worth 9,419.94 6,458.52 4,488.27Total Borrowings 2092.70 3,037.94 2,519.11Revenue from Operations 19,275.58 13,906.26 12,898.81EBITDA 4,204.44 2,965.00 2,985.12Profit Before Tax 3,848.37 2,534.39 2,472.84Net Profit for the year 3,026.03 2,031.55 1,901.27
RatingSubscribe(Aggressive Investors)Issue OfferIssue Opens on Nov 01, 2021Issue Close on Nov 03, 2021Total IPO size (cr) 5,625Fresh issue 3,750Offer For Sale (cr) 1,875Price Band (INR) 940-980Market Lot 15Face Value (INR) 2Retail Allocation 10%Listing On NSE, BSEObjects of the issue ⮚ For enhancing visibility and business expansion ⮚ To expand consumer base including offline presence. ⮚ Strategic investments and acquisitions ⮚ For General corporate purposes.Issue Break-up (%)QIB Portion 75NIB Portion 15Retail Portion 10Indicative TimetableFinalisation of Basis of Allotment 10-11-2021Refunds/Unblocking ASBA Fund 11-11-2021Credit of equity shares to DP A/c 12-11-2021Trading commences 15-11-2021
PB Fintech is India’s largest online platform for insurance and lending products leveraging the power of technology, data and innovation.
It provides convenient access to insurance, credit and other financial products and aims to create awareness amongst Indian households about the financial impact of death, disease and damage. The company launched Policybazaar, its flagship platform, in 2008 to respond to Consumers’ need for more awareness, choice and transparency and create a consumer-pull based, provider-neutral model for insurance distribution.
In 2014, the company launched Paisabazaar with the goal to transform how Indians access personal credit by accentuating ease, convenience and transparency in selecting a variety of personal loans and credit cards.
⮚ In Fiscal 2020, Policybazaar was India’s largest digital insurance marketplace among all online insurance distributors with a 93.4% market share based on the number of policies sold.
⮚ Paisabazaar was India’s largest digital consumer credit marketplace with a 53.7% market share, based on disbursals in Fiscal 2021
⮚ Follows an asset-light capital strategy and do not underwrite any insurance or retain any credit risk on their books. Policybazaar is registered with and regulated by IRDAI as a direct insurance broker.
⮚ The market for insurance products as well as the lending market in India is expected to be more than double by 2030, which represents a meaningful market opportunity for the company.
⮚ Policybazaar offers an information-rich, user-friendly, and tech-driven self-service platform for
The company had consistent revenue growth in the last 3 years. The company's revenue for FY21 was at Rs 957.4 crore VS Rs 855.56 cr in FY20 while the company has never registered profit.
The company recorded a loss of (150.24) cr in FY21 against a loss of Rs (304.03) cr in FY20. New edge businesses are garnishing investors' interest in India and we have seen many multi-baggers from such kinds of businesses in the USA and China.
PB fintech is the operator of India's largest online platform for insurance and lending products and aiming toward expansion of its offline and customer base. The valuation of the company cannot be ascertained as the company is loss-making while the EV/Sales work out 47.6x.
Eying the positive outlook of the company and under penetration of the insurance industry, we assign a “SUBSCRIBE” only for Aggressive investors.
PB FINTECH IPO (POLICY BAZAAR)
⮚ Mr Yashish Dahiya is the Chairman, Executive Director and CEO of the Company He holds a bachelor’s degree in technology from IIT, Delhi, a PGDM from IIM, Ahmedabad
⮚ Mr Alok Bansal is a Whole-time Director and CFO of the Company. He was previously associated with Voltas Ltd., GE (India), iGate Global Solutions Ltd, M&M and FE Global Technology Services Pvt. Ltd.
⮚ Ms Kitty Agarwal is a Non-executive Director of the Company. She is currently associated with Info Edge Ventures as a partner and was previously associated with Info Edge Ltd. as head of corporate development.
⮚ Mr Sarbvir Singh is the President of Policybazaar and Non-executive Director of the Company.
⮚ Mr Munish Ravinder Varma is a Non-executive Director of the Company. He currently serves as a managing partner at SoftBank Investment Advisers. He was also associated with Deutsche Bank AG.
⮚ Mr Kaushik Dutta is an Independent Director of the Company He is a fellow member of the Institute of Chartered Accountants of India with over 25 years of experience.
⮚ Ms Veena Vikas Mankar is an Independent Director of the Company. Ms. Mankar started her career with ICICI Limited and has worked with various financial institutions.
⮚ Ms Lilian Jessie Paul is an Independent Director of the Company.
⮚ Mr Nilesh Bhaskar Sathe is an Independent Director of the Company.
⮚ Mr Gopalan Srinivasan is an Independent Director of the Company.
⮚ Created strong, Consumer-friendly brands offering wide choice, transparency and convenience well-diversified business model.
⮚ Proprietary Technology, Data and Intelligence Stack
⮚ Benefits from economies of segmentation
⮚ Strong network effects for Policybazaar and Paisabazaar platforms.
⮚ High renewal rates provide clear visibility into future business and deliver superior economics.
⮚ Capital efficient model with low operating costs.
⮚ Founders with clarity of purpose backed by experienced management.
⮚ The company has a history of losses and it anticipates increased expenses in the future.
⮚ The COVID-19 pandemic, or a similar public health threat, could adversely affect their business, financial condition, and results of operations.
⮚ Failure to deal effectively with any fraud perpetrated on our platforms could harm our business.
⮚ Their strategy to expand internationally involves risks that could increase expenses, adversely affect results of operations and require increased time and attention from the management.
⮚ Business is subject to intense competition.
⮚ Failure to maintain brand recognition and reputation will adversely affect business financials.
⮚ The insurance broking business is subject to various laws and regulations.
⮚ Highly dynamic and competitive online fintech industry.
IPO Note
PB FINTECH IPO (POLICY BAZAAR)
COMPARISON WITH LISTED INDUSTRY PEERS
There are no listed companies in India that engage in a business similar to that of the Company. Accordingly, it is not possible to provide an industry comparison in relation to the Company while the EV/Sales work out to be 47.6x.
FINANCIALS (RESTATED CONSOLIDATED)
Particulars (Rs. In Millions) FY 2021 FY 2020 FY 2019Equity Share Capital 12.35 11.09 8.77Other Equity 19,904.99 12,647.38 4,894.17Net Worth 19,917.34 12,658.47 4,902.94Total Borrowings -- -- --Revenue from Operations 8,866.62 7,712.97 4,922.45EBITDA (1,597.63) (3,198.92) (2,512.32)Profit Before Tax (1,419.14) (2,948.41) (3,374.30)Net Profit for the year (1,502.42) (3,040.29) (3,468.11)
On Thursday, the shares of IRCTC was revitalized 16% after the stock turned into an ex-split. The organization had fixed October 29 as the record day for the stock split in the proportion of 1:5. Earlier, the board of IRCTC had endorsed a stock split on August 12.
Essentially, this implies that each stock will be split into 5 shares This builds the liquidity of the stock by reducing its stock value, subsequently making it more reasonable for investors and traders.
On October 19, 2021, the stock made a record high of Rs1,279 (acclimated to stock split) and has increased the investor’s wealth to a greater extent, which is more than 100% in the recent months.
A stock split builds the number of portions of a firm. In this case, the total number of shares will uplift 5 times however the offer cost will decrease.
This doesn't influence the market cap of the firm. Existing shares might slip yet the worth remains the same as before.
If we take the case of IRCTC, if investors possess 5 shares of the organization, the number of shares will increment to 25. The price of the stock of each share will get reduced. However, their fundamental value will remain the same as before.
The primary reason behind the stock split is to make shares more reasonable for the investors. It happens after a significant run-up of a stock's price.
Before declaring a stock split, the share price of IRCTC was around Rs 4000, even after a major decline from its all-time high of Rs 6,369.
Earlier, the stocks of IRCTC was quite expensive for small investors but after the stock split, the share prices had reduced to Rs 900, making it more appealing for investors.
It does not just advantage the current investors but also for the future investors. This is because IRCTC expanding the number of shares they hold.
It may be noted that there are no extra costs incurred during a stock split. The organization’s finances like revenue, income, operational expenses etc are not much affected after the stock split, nor is the market cap of the firm.
Maximize the ROI by increasing areas of core competencies.
Increase business opportunities through effective partnership between public and private agencies.
Adopt ethical and strong work culture by teamwork as well as the reposition of Railways in the emerging economy.
Concern for heritage and environment.
To be totally friendly to customers and driven by the innovation, and development of human resources.
The fundamentals of IRCTC are very strong even before the stock split. Hence, the analysts recommended their investors hold their stocks instead of buying because of higher valuations. The split just makes the stock more appealing to the investors.
Aside from the stock split declaration, the sudden increase in railway bookings because the economy gets railed again and a decline in COVID cases are the positive news for the IRCTC stocks.
IRCTC has started an online rail ticketing system where any user can book a ticket via SMS or GPRS. It likewise gives an SMS office to check the current PNR status and live train status also.
IRCTC additionally offers catering administrations to its travelers by serving freshly cooked food. IRCTC has also taken the rights for onboard catering of food on all trains operated by Indian railways.
It also has cafeterias such as a food plaza, Jan Aahar at numerous railway stations.
IRCTC accepted its approval for the stock split solely after it declared its quarterly income in August.
IRCTC took this choice simply because it will assist the organization with improving its liquidity in the securities exchange, which thus makes shares accessible for the small financial backers and investors.
The organization further said that the approved offer capital will remain the same at Rs 250 Crore while post-split, the share price will increment up to 1,25,00,00,000 from 25,00,00,000.
IRCTC launched its IPO in October 2019 and thus it entered the primary market. Since launching, the company has also enjoyed its monopoly in the capital market because it's the only company that provides and manages catering services to Indian Railways and at major units at railway stations.
It has been seen that after launching its IPO, the company has managed to give steady returns to its shareholders. The share price of IRCTC has increased more than 10 times from Rs 320 per share to Rs 3,790 within 2 years.
In the June quarter, the net profit of IRCTC has marked at Rs 82.5 crore, whereas its revenue rose up to Rs 257 Crore. Also, the company has increased its revenue to Rs 149 Crore and from the tourism category, the expected revenue was more than doubled to Rs 7 Crore.
The future plans of IRCTC are moving its business to transport, air tickets, tour and travel planners that could bring a new opportunity for the organization to reinforce its position.
IRCTC is the only approved organization that provide online tickets and catering services to the Indian Railways. Hence, we can say that it holds a pure monopoly in business.
Ex split of IRCTC has various advantages as it improves the liquidity in the capital market to build the investor base and makes the share affordable to small investors.
If you are a newbie who wants to start investing in stocks, then IRCTC would be a safe game to play. IRCTC is a government-owned organization and hence investing in it will give you significant gain in the future.
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