Shares of Indian Railway Catering and Tourism Corporation (IRCTC) came under intense selling pressure after the stock came out of the National Stock Exchange’s futures and options ban list on Monday. IRCTC shares fell as much as 14.32 per cent to hit an intraday low of Rs 3,960.05. The NSE places those shares under the Futures and Options ban list which cross 95 per cent of the market-wide position limit. As per the exchange rules, the positions for shares under the Futures and Options ban list can only be sold and fresh buy orders cannot be placed for the shares under the ban list.
Meanwhile, Escorts, Indiabulls Housing Finance, Vodafone Idea, India Energy Exchange, Punjab National Bank and Steel Authority of India SAIL were added to the futures an option ban list of shares.
IRCTC shares have come under selling pressure on account of profit-booking after sharp-run up that the stock witnessed during the first 18 days of the current month wherein it rallied a whopping 68 per cent from September 30 closing price of Rs 3,797 to hit an all-time high of Rs 6,393 on October 19, analysts said.
IRCTC shares have so far corrected 38 per cent from record high in the three out of last five trading sessions.
IRCTC shares have been on investors’ radar after the company’s board approved stock split in ratio of 1:5 in August. IRCTC’s board decided to split the stock in order to help enhance liquidity in the capital market, widen shareholder base and make the shares affordable to small investors.
“IRCTC is one particular company which has a virtual monopoly for Indian Railways. The amount of services it caters to is huge and there is no competition. The stock can thus achieve higher levels. There will be corrections, but smart long term investors can buy into all dips,” Gaurang Shah of Geojit Financial Services told NDTV.
As of 12:55 pm, IRCTC shares traded 10.72 per cent lower at Rs 4,126, massively underperforming the Sensex which was up 0.36 per cent.