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Passengers board an overcrowded train at a railway station in Ajmer, India, October 23, 2016.Reuters file

The government of India formally approved a move to list 11 central public sector enterprises (CPSEs) including four belonging to the railway ministry, marking a significant step towards economic reforms.

The decision to list the four rail PSUs — IRCTC, RITES, Rail Vikas Nigam, Indian Railway Finance Corporation (IRFC) — and seven other entities was taken at a cabinet meeting chaired by Prime Minister Narendra Modi on Wednesday.

The government will be offloading up to 25 percent of its stake in these companies that could also include fresh issue of shares by the respective companies.

Other CPSEs that will be listed on the stock exchanges include Garden Reach Shipbuilders, Bharat Dynamics, MSTC, Mazagon Dock Shipbuilders and Mishra Dhatu Nigam.

The government's disinvestment target for the current fiscal is Rs 72,500 crore, as announced by finance minister Arun Jaitley while presenting India's first unified budget for 2017-18.

Disinvestment proceeds form a major portion of revenues for the government, after taxes.

Indian Railway Catering & Tourism Corporation (IRCTC) predominantly derives its revenues from sale of railway tickets online — it sold 200 million tickets on its portal valued at about Rs 22,500 crore in 2015-16. Other businesses of IRCTC include catering and tourism promotion with packaged tours (tourist circuits).

The company had 1,483 employees and earned net profit of Rs 188.63 crore in 2015-16, according to its annual report for FY2016.

RITES, established in 1974, provides consultancy services in transport, infrastructure and related technologies. For 2016-17, it had earned a net profit of Rs 339 crore on total revenues of Rs 1,294 crore. It had 3,153 employees as of March 31, 2016. The company's share capital is Rs 100 crore. 

In the domestic market, RITES is involved with many Metro projects including Delhi and Bangalore. Overseas, it has executed projects in Myanmar, Bangladesh, Mozambique, Sri Lanka and Kenya.

IRCON International Ltd. is a construction company engaged in railway electrification, signal and telecommunication, construction of roads, highways, commercial, industrial and residential complexes, airport runways, airport constructions, leasing of locomotives and mass rapid transit system.

The company earned net profit of Rs 379 crore on total income of Rs 2,703 crore in 2015-16. It had 1,499 employees as of March 31, 2016.

IRFC, or Indian Railway Finance Corporation, a financial services company under the railway ministry, reported net profit of Rs 848.69 crore on total income of Rs 7,503 crore in 2015-16.

Company Profile Employees 2015-16 2014-15 2013-14
IRCTC Ticketing, catering, tourism 1,483 Income 1,505* Net Profit 188* Income 1,141*Net Profit 130* Income 955*Net Profit 72*
IRCON Infrastructure 1,499 Sales 2,703* Net Profit 379* Sales 3,122*Net Profit 579* Sales 4,057*Net Profit 907*
IRFC Financial services Not available Sales 7,503*Net Profit 848* Sales 6,940*Net Profit 758* Sales 6,198*Net Profit 700*

*: Figures in Rs crore.

Source: Annual reports.

IRCTC had estimated that its ticket sales for FY2017 (April 2016-March 2017) would be about 225 million and earn Rs 27,000 crore.

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Passengers at Chennai railway station.IBT Media/S V Krishnamachari