IRFC eyes ₹1 lakh crore loan milestone in FY27; shares in focus

To fund its business growth, the public sector undertaking (PSU) of the Ministry of Railways is looking to raise ₹70,000 crore, including from overseas, in FY27.

"We are aiming for a loan sanction of ₹1 lakh crore and disbursement of about ₹40,000 crore during the ongoing financial year, as the pipeline of high-quality infrastructure projects looks strong," IRFC Chairman and Managing Director Manoj Kumar Dubey told PTI.

A steady pipeline and emerging opportunities in sectors such as metros and ports are expected to further accelerate growth in the coming financial year, following its whole-of-government approach, Dubey said.

During FY26, lRFC sanctioned projects worth ₹72,949 crore and disbursed approximately ₹35,067 crore, exceeding its annual guidance.

The company, which last year got Navratna status, witnessed its net worth rise to an all-time high at ₹56,748 crore and AUM crossing a record high at ₹4.85 lakh crore.

The diversification-led expansion resulted in improved spreads and a consistent rise in net interest margin (NIM), while lRFC maintained its zero NPA status.

"Our diversification strategy is now translating into stronger spreads, improved margins, and enhanced shareholder value", Dubey said, adding that NIM should further improve to 1.65% in FY27 as against 1.5% recorded in FY26.

The chairman further said IRFC made a structural shift in its business model, from a traditional railway financier to a diversified infrastructure financing institution, keeping railways at its centre.

With Indian Railways not availing fresh disbursements since 2023-24, the company has expanded into sectors with strong forward and backward linkages to railways, including power generation, renewable energy, transmission, fertilisers, and railway-linked infrastructure.

IRFC Q4 FY26 results

Last week, IRFC posted a flat net profit at ₹1,684 crore for the fourth quarter ended March 2026 (Q4 FY26).

The public sector undertaking (PSU) of the Ministry of Railways had earned a net profit of ₹1,682 crore during the fourth quarter of FY25.

The company's total income rose to ₹7,329 crore in the January-March quarter of FY26, up 9% year-on-year (YoY) from ₹6,724 crore in the same period of FY25, IRFC said in a regulatory filing.

During the period under review, its interest income also increased to ₹2,902 crore as against ₹1,970 crore a year ago.

Total expenses stood at ₹5,644 crore, compared to ₹5,042 crore in the corresponding quarter a year ago.

For the financial year ended March 31, 2026, IRFC reported its highest-ever profit of ₹7,009 crore, compared to ₹6,502 crore in 2024-25, registering a growth of 7.8%.

Other key details

Assets Under Management (AUM) hit a record high, expanding to ₹4.85 lakh crore through fresh sanctions and disbursements in railway-linked segments, it said.

The railway PSU actively participated in competitive and bilateral financing opportunities, securing bids worth around Rs 56,251 crore and building a robust pipeline of high-quality infrastructure assets, it said.

About IRFC

Indian Railway Finance Corporation Limited (IRFC), established in 1986, is a Government of India enterprise and functions under the Ministry of Railways. It serves as the dedicated financing arm of Indian Railways.

The company mobilises funds from capital markets and financial institutions to support Indian Railways’ expansion through the purchase of locomotives, coaches, wagons, and by financing its large infrastructure projects.

Its unique cost-plus financing model ensures predictable earnings and stable cash flows.

Core business segments

• Rolling Stock Financing – IRFC is the financer for Indian Railways for the procurement of locomotives, passenger coaches, and freight wagons. IRFC and Indian Railways usually enter long-term financing contracts for this.

• Infrastructure Financing – IRFC also funds railway electrification, track doubling, metro rail works, and station redevelopment.

• Market Borrowings and Bonds – IRFC raises its capital by issuing domestic bonds, zero-coupon bonds, deep-discount bonds, and external commercial borrowings to further finance the railways.

• Lease and Loan Services – The company provides long-term lease and loan facilities with loan tenure and repayment aligned with the entire project life cycle.

• Diversification Initiatives – Recently expanded funding activities into sectors linked to railway infrastructure, such as ports, power, fertiliser projects, and metro rail systems.