The railway ministry is planning to reverse its decision requiring the Indian Railway Catering and Tourism Corporation (IRCTC) to share half of its convenience fee revenue. The secretary of the Department of Investment and Public Asset Management (DIPAM) confirmed the decision on Twitter. After a sharp drop in IRCTC stock on Friday, this move was made. The railway ministry asked the Indian Railways' e-ticketing and catering arm to share revenue with the ministry on October 28.

Following the railway ministry's decision, IRCTC's stock dropped by as much as 29% to an intraday low of RS 650.10 on the BSE on Friday. “...it is to be informed that the Ministry of Railways...has communicated its decision to share the revenue earned from convenience fees collected by IRCTC in the ratio of 50:50 w.e.f 1st November 2021,” the company said in a stock exchange filing on Friday.

The IRCTC began sharing revenue with Indian Railways on an 80:20 basis in 2014. The ration was changed to 50:50 later in 2015. However, beginning in November 2016, the revenue sharing system was suspended for three years. According to the annual report, the convenience fee earned IRCTC Rs 299.13 crore in 2020-21. Due to Covid-related restrictions, revenue from catering and comprehensive services fell significantly in 2020-21, making this the highest revenue earner for IRCTC. It's worth noting that the revenue from convenience fees fell as a result of the Covid-19 pandemic in India and the resulting travel restrictions. In the fiscal year 2019-20, IRCTC earned Rs 349.64 crore.

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