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Shareholding Info
  • Promoters
    86.36 %
  • Foreign institutions-FII
    1.15 %
  • Other domestic institutions
    0.76 %
  • Retail and other
    11.33 %
  • Mutual Funds
    0.4 %

Indian Railway Finance Corporation (IRFC)


Set up in December 1986, the Indian Railway Finance Corporation (IRFC) is a public sector undertaking (PSU) with the government owning a majority stake.

IRFC, the financing arm of the Indian Railways, arranges funds from domestic and overseas markets to meet requirements, beyond budgetary allocations. In more than three decades of its existence, IRFC has played a key role in supporting the expansion and modernisation of the Indian Railways. The primary operations of the company include financing the acquisition of rolling stock assets, leasing of railway infrastructure assets and national projects. IRFC also provides lending to various entities of the Railway Ministry.

The company borrows funds from the financial markets to fund the acquisition or creation of assets, which are then leased out to the Indian Railways. The cumulative funding by IRFC to the railway sector crossed ₹5.04 lakh crore in FY2022. It has funded acquisition of 13764 locomotives, 76735 passenger coaches, and 265815 wagons, which constitute around 75% of the total rolling stock fleet of Indian Railways.

The Railway Ministry PSU has a market capitalisation of ₹100,078 crore as on December 9, 2023. The government held an 86.36% stake in the company as on September 30, 2023.

IRFC was listed on the bourses after launch on its IPO in January 2021. IRFC share price has surged more than 228% since its listing on the bourses, as of December 11, 2023.

Business segments of IRFC


Leasing Operations


This remains the primary business segment of IRFC, contributing a significant portion of its revenue. IRFC uses a leasing approach to fund Indian Railways' rolling stock and project assets, including locomotives, coaches, wagons, trucks, flats, electric multiple units (EMUs), containers, cranes, trolleys, and other rolling stock components.

The company’s lease term is essentially 30 years – a primary component of 15 years and a secondary of 15 years.

During the primary lease period, the principal component and interest are recovered as part of the lease. During the secondary lease period of 15 years, IRFC receives a nominal rent.

After secondary lease period assets are normally transferred to the Railway Ministry at a nominal amount. It has a cost-plus leasing agreement with the Ministry of Railways, which ensures consistent growth in its income and profitability. The Ministry pays half-yearly lease rentals, which include both principal repayment and interest.

The company provides funds to Indian Railways’ entities like Rail Vikas Nigam Ltd (RVNL), Rail Land Development Authority and Railtel Corporation of India.

Borrowing operations


IRFC raises funds through various sources at very competitive rates. The source of funds include taxable and tax-free bonds issuances, term loans from banks and financial institutions, commercial papers, external commercial borrowings and asset securitisation. Due to its strong credit ratings, it gets funds at significantly low cost. As of March 31, 2023, the company borrowed funds of ₹1,84,531 crore, which included ₹1,59,041 crore in term loans and ₹71,738 crore in external borrowing.

Financial highlights


  • In FY23, IRCF’s total income surged 17.7% to ₹23,891.27 crore from ₹20,298.27 crore in FY22.
  • The total expenditure was at ₹49,450.6 crore, up 11% from ₹44,399.87 crore in the year before.
  • The profit before tax increased 4% to ₹6,337.01 crore from ₹6,090.15 crore.
  • There was also a 4% jump in IRFC’s net profit at ₹6,337.01 crore as against ₹6089.84 crore in FY 2021-22.
  • Earnings per share increased to ₹4.85 in FY23 from ₹4.66 in the previous financial year.

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