Indian Railway Finance IPO: Key Details

IRFC IPO: Key Updates

Note: We neither trade nor encourage our readers to trade in the Grey Market. We share the GMP information for educational purposes only, so that, you can make an informed decision.

Company Information

Indian Rail Finance Corporation (IRFC), incorporated in 1966, is the dedicated market borrowing arm of the Indian Railways. It primarily deals with financing the assets of the Indian Railways and lending to other entities under the Ministry of Railways. It takes care of these financial needs by raising capital for expansion through capital markets and other borrowings. In the last fiscal, 2019, IRFC financed ₹525.35 billion accounting for 39.38% of the actual capital expenditure of the Indian Railways.

Primary business activities performed by IRFC:

• Financing rolling stock assets, which includes both powered and unpowered vehicles, (locomotives, coaches, wagons, trucks, flats, electric multiple units, containers, cranes, trollies)
• Leasing of railway infrastructure assets and national projects of the Government of India (collectively, Project Assets) and
• Lending to other entities under the Ministry of Railways, Government of India

Competitive Strengths

• Strategic role in financing growth of Indian Railways
• Competitive cost of borrowings based on strong credit ratings in India and diversified sources of funding
• Low risk business model, exclusive partnership with Ministry of Railways
• Strong asset-liability management
• Experienced senior management and committed team

Company Strategy

1. Diversification of borrowing portfolio
2. Broaden the financing portfolio
3. Continued focus on asset-liability management
4. Provide advisory and consultancy services and venture into syndication activities
5. Stable and long-term Leasing Operations

Proceeds from the IPO will be used to:

• Augment IRFC’s equity capital base to meet future capital requirements
• General corporate purposes