Advertisement
When should a housing society in Mumbai start considering re...
From GST on JDAs to SEBI’s REIT reclassification and the S...
Stay ahead in the world of real estate with our daily podcas...
Stay ahead in the world of real estate with our daily podcas...
The Government of India has launched an offer for sale to divest up to 4% stake in Indian Railway Finance Corporation (IRFC) at a floor price of INR 104 per share. The base issue comprises 2% equity, with another 2% under a green shoe option. The total divestment could fetch around INR 5,430 crore. Non-retail investors were allowed to bid first, followed by retail investors. The announcement led to a decline in the stock price, even as IRFC recently reported its highest quarterly profit with steady loan growth.
The Government of India has initiated the sale of up to 4% of its equity in Indian Railway Finance Corporation (IRFC) through an offer for sale mechanism. The floor price has been fixed at INR 104 per share. The base offer consists of a 2% stake, while an additional 2% stake is available under the green shoe option, taking the total potential divestment to 4% of the company's paid-up equity capital. Advertisement
Under the offer structure, over 26.13 crore shares were made available in the base issue. An equal number of shares may be sold if the green shoe option is exercised, depending on demand. At the indicated floor price, the government may raise nearly INR 5,430 crore if the entire 4% stake is sold.
Non-retail investors were permitted to place bids on the first day of the offer. Retail investors were allowed to participate subsequently. The floor price was set at a discount to the previous closing market price, which resulted in pressure on the stock. During intra-day trade, IRFC shares declined by around 4% on the BSE. The stock was also trading below its 50-day and 200-day moving averages, reflecting weak short-term technical trends.
IRFC functions as the dedicated financing arm of Indian Railways. It raises funds from domestic and international markets to finance rolling stock acquisition and infrastructure projects. The company plays a key role in supporting extra-budgetary resource requirements of the railway sector.
In its most recent quarterly results, IRFC reported its highest-ever quarterly profit. The growth was supported by a steady increase in its loan book and stable interest margins. The company continues to maintain a strong asset quality profile due to its sovereign-backed business model.
The present divestment forms part of the government's broader disinvestment strategy aimed at increasing public shareholding in listed public sector undertakings and improving market liquidity. The government remains the majority shareholder even after the proposed stake sale.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
