The comptroller and auditor general (CAG) said that Indian Railways' FY18 operating ratio of 98.44 percent was the worst in ten years. The CAG further added that 95 percent of the profit from freight traffic was utilized to compensate the loss on operation of passenger and other services.
Mahendra Pratap, CMD of Indian Railway Catering and Tourism Corporation (IRCTC) said they saw no impact of the CAG report on their performance and are not forced to revise prices or delay payments.
Talking about revenues he said, “We are still in a transition phase. We have started charging convenience fee from September 1, which will have a major impact on revenues as well as profitability.” For a full financial year, convenience fee will bring about Rs 600 crore added revenues, he said in an interview with CNBC-TV18.
Moreover, with other segments like packaged drinking water they are adding more plants, he said. "This financial year we plan to commission 6 plants and maybe we will be commissioning 7th plant also. In catering also we are seeing growth; tariffs which were overdue for revision have been recently revised and that will also have an impact on our financials."
However, these things have been there only for few months in the current financial year and so, the overall impact will be known only in the next financial when all these things will have impact for the complete year, he added.
The prices of meal prices were primarily revised to meet quality, he said adding that the last revision was in 2013. "So, margins will improve but the primary emphasis is on improving quality," he added.
Talking about private trains, he said, “Golden Chariot is a luxury train which was so far managed by Karnataka Tourism Development Corporation but they were not running it for last 2 years. This year we did a tie-up with them, it’s on revenue sharing mechanism and we will start operating this by March ’20.”