IRCTC cancels mobile catering contracts

IRCTC announced on Wednesday that 136 contracts, taken over from the railways as per the Catering Policy of 2017 and five long term contracts, that were kept in abeyance, have been terminated.

On 1 March 2021, a directive sent by Ministry of Railways (MoR) to IRCTC (based on orders of High Court of Judicature at Madras as on 19 January 2021) had ordered the termination of all existing contracts of mobile catering (currently kept in abeyance) involving scope of work of providing cooked food to passengers prepared from base kitchens as per the existing terms and conditions was informed. It was also informed that the impact of the directive would be assessed and informed to exchanges later onwards.

 

As per MoR's directive, 136 contracts, taken over from the Railways as per the Catering Policy of 2017 and five long term contracts, that were kept in abeyance, have been terminated. This is in regards to the Madras High Court order to terminate all existing contracts of mobile catering. These contracts were for the regular trains, which are not in operation as on date.

IRCTC added that there has been no major impact of these terminations in this FY 2020-21 and the impact, if any, will be reassessed on resumption of regular train services and subject to outcome of the ongoing litigation. The announcement was made post trading hours yesterday, 17 March 2021.

The company's standalone net profit tanked 62.1% to Rs 78.09 crore on 68.7% fall in net sales to Rs 224.37 crore in Q3 December 2020 over Q3 December 2019.

IRCTC, a Mini Ratna public sector enterprise under the administrative control of Ministry of Railways, is the sole entity authorized by Indian Railways (IR) to provide catering services to railways, online railway tickets and packaged drinking water at railway stations and trains in India.

Shares of IRCTC fell 0.24% to Rs 1,817.20 on BSE. The Government of India holds 67.40% stake in IRCTC as of 31 December 2020.

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