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Indian Railway Finance Corporation (IRFC) is a prominent financial institution based in New Delhi, India, with a market capitalization of Rs. 161,291.4 Crores. Incorporated in 1986, the company specializes in leasing rolling stock and railway infrastructure assets within India, supporting the operations of the Indian Railways.
The primary activities of IRFC include engaging in the lending business and borrowing funds from financial markets to finance asset acquisition and creation, which are then leased out to Indian Railways. As a non-deposit taking, non-banking financial company, IRFC plays a crucial role in the financing of railway infrastructure.
Over the last 12 months, IRFC reported a revenue of Rs. 26,910.6 Crores and a notable profit of Rs. 6,537.5 Crores, indicating its robust financial performance. The company has also experienced impressive revenue growth of 42.9% over the past three years.
Additionally, IRFC is committed to returning value to its investors, boasting a dividend yield of 1.22% per year. In the past year, the company distributed a dividend of Rs. 1.5 per share, reflecting its profitable operations and dedication to shareholder returns.
Size: It is among the top 200 market size companies of india.
Smart Money: Smart money is taking extra interest in the stock as they increase their holdings.
Profitability: Very strong Profitability. One year profit margin are 24%.
Technicals: Bullish SharesGuru indicator.
Buy Backs: Company has bought back it's stock in the past which is a good thing.
Momentum: Stock has a weak negative price momentum.
Comprehensive comparison against sector averages
IRFC metrics compared to Finance
| Category | IRFC | Finance |
|---|---|---|
| PE | 25.59 | 18.26 |
| PS | 6.22 | 3.81 |
| Growth | 1.7 % | 10.4 % |
IRFC vs Finance (2022 - 2025)
Summary of Indian Railway Finance Corp's latest earnings call, featuring management's outlook on business performance, financial results, and analyst Q&A sessions that highlight key strategic initiatives and market challenges.
Last updated: Jan 25
The management of Indian Railway Finance Corporation (IRFC) outlined a strategic outlook focused on diversification, margin expansion, and sustained growth. Key points include:
Diversification Beyond Railways: IRFC is actively expanding into Railway-linked infrastructure projects (e.g., coal mining, ports, logistics) with higher margins (3x"“5x current Railway margins). This includes refinancing high-cost debt in the Railway ecosystem and exploring PPP opportunities.
Financial Strength: The company maintains a robust CRAR (over 700%) and a zero-NPA track record. It aims to keep the debt-to-equity ratio at 8"“9x, balancing growth with prudence.
Margin Improvement: Focus on cost optimization and cheaper funding (54EC bonds, zero-coupon bonds) to boost PAT. Non-Railway projects, though smaller in AUM contribution, will drive disproportionate profit growth due to higher yields.
Growth Trajectory: Despite flat top-line growth in recent quarters, PAT is expected to rise steadily as the business mix shifts toward higher-margin assets. Management anticipates visible results from new ventures in subsequent quarters.
Budget and Government Support: While not reliant on budgetary allocations, IRFC remains positioned to capitalize on Railway EBR (Extra Budgetary Resources) if needed. Emphasis is on self-sustained growth via diversification.
Long-Term Opportunities: Projects under initiatives like Gati Shakti (multimodal connectivity) and international corridors (e.g., India-Middle East-Europe) are seen as future growth drivers.
Tax Efficiency: IRFC expects no tax liabilities for 4"“5 years due to unabsorbed depreciation, aiding net profit retention.
Overall, IRFC's outlook is optimistic, emphasizing strategic diversification, operational efficiency, and leveraging its financial strength to enhance profitability and shareholder value.
Last updated: Jan 25
1. Question on Debt-to-Equity Ratio Policy
Question: "Is there a concrete policy on IRFC's debt-to-equity ratio, given the high CRAR? Can it breach the self-imposed limit of 10x?"
Answer: IRFC's debt-to-equity ratio is not regulatory but a self-imposed target. While historically set at 10x, the focus is now on maintaining 8-9x to accommodate diversification into non-Railway projects. This aligns with strategic growth plans while ensuring financial prudence.
2. Question on Stagnant Financial Results and Future Outlook
Question: "Why have top/bottom lines remained stagnant? What is the forward-looking guidance?"
Answer: Stability reflects disciplined consolidation. Future growth will stem from non-Railway projects (e.g., coal mining), offering 3x"“5x higher margins than Railways. PAT growth will outpace AUM growth as high-yield projects dominate the portfolio.
3. Question on Railway Budget Allocations
Question: "Given no recent Railway budget allocations, what are IRFC's expectations?"
Answer: IRFC is shifting focus to non-Railway ecosystem projects (e.g., PPP, refinancing) with better margins. Government EBR reliance is secondary; diversification ensures growth regardless of budgetary allocations.
4. Question on Coal Project Margins
Question: "How do spreads work for the coal mining project?"
Answer: Margins are 3x"“5x higher than Railways. IRFC's low-cost funding (e.g., tax-free bonds, domestic/ECB markets) enables competitive bids, ensuring profitability while undercutting peers.
5. Question on AUM Post-Moratorium
Question: "How will AUM be impacted after FY28 when moratoriums end?"
Answer: AUM will remain stable as capital recovery offsets new disbursements. Post-FY28, non-Railway projects (higher yield, lower volume) will drive PAT, reducing reliance on EBR-linked AUM.
6. Question on Gati Shakti Program
Question: "Can IRFC benefit from the Gati Shakti multimodal project?"
Answer: Yes. Projects under Gati Shakti (e.g., freight corridors) align with IRFC's mandate. Funding opportunities could emerge depending on government CAPEX allocation, offering long-term AUM growth.
7. Question on Tax Status
Question: "Will non-Railway business affect IRFC's zero-tax status?"
Answer: No. Unabsorbed depreciation (Rs.6,000+ cr) shields against tax liabilities for 4"“5 years. Current tax-free status remains unaffected by diversification.
8. Question on Net Interest Margin (NIM) Improvement
Question: "Will NIM improve in FY25?"
Answer: Yes. Higher-margin non-Railway projects will gradually improve NIM. Exact figures depend on business mix, but incremental growth is expected quarterly.
Understand Indian Railway Finance Corp ownership landscape with insights into key distribution patterns, offering investors a clear view of stakeholder dynamics.
| Shareholder Name | Holding % |
|---|---|
| President Of India Acting Through MoR | 86.36% |
Distribution across major stakeholders
Distribution across major institutional holders
Updated Apr 28, 2025
IRFC shares recently dipped by 0.97% amid changing market sentiment and investor caution ahead of the Q4 FY25 results, which has led to profit-taking.
Analysts have advised a 'SELL' rating on IRFC shares due to its premium valuation, reflecting concerns regarding the company's near-term performance amidst economic uncertainties.
Despite a nearly 9.9% increase in stock value over the past month, IRFC has experienced a year-to-date decline of 13.94%, indicating ongoing investor concerns.
IRFC has emerged as the lowest bidder for a ₹5000 crore term loan to NTPC, highlighting its strong position in financing renewable energy projects.
IRFC has received interim relief in a GST dispute, allowing the company to respond to a demand order of ₹230.55 crore, potentially easing financial pressures.
IRFC's establishment of a CSR Foundation is expected to enhance its corporate social responsibility initiatives, potentially boosting its public image.
This information is AI-generated and may contain inaccuracies. Please verify from multiple sources.
Investor Care | |
|---|---|
| Dividend Yield | 1.8% |
| Dividend/Share (TTM) | 2.3 |
| Shares Dilution (1Y) | 0.00% |
| Diluted EPS (TTM) | 5.01 |
Financial Health | |
|---|---|
| Debt/Equity | 0.00 |
| Debt/Cashflow | 0.00 |
Valuation | |
|---|---|
| Market Cap | 1.67 LCr |
| Price/Earnings (Trailing) | 25.61 |
| Price/Sales (Trailing) | 6.22 |
| EV/EBITDA | 6.25 |
| Price/Free Cashflow | 23.08 |
| MarketCap/EBT | 25.61 |
Fundamentals | |
|---|---|
| Revenue (TTM) | 26.91 kCr |
| Rev. Growth (Yr) | 0.31% |
| Rev. Growth (Qtr) | -1.94% |
| Earnings (TTM) | 6.54 kCr |
| Earnings Growth (Yr) | 1.65% |
| Earnings Growth (Qtr) | 1.12% |
Profitability | |
|---|---|
| Operating Margin | 24.29% |
| EBT Margin | 24.29% |
| Return on Equity | 12.7% |
| Return on Assets | 1.32% |
| Free Cashflow Yield | 4.33% |
Detailed comparison of Indian Railway Finance Corp against industry peers, highlighting key financial metrics, valuation ratios, and performance indicators to provide competitive context within the sector.
Ticker | Name | Mkt Cap | Revenue | Price %, 1M | Returns, 1Y | P/E | P/S | Rev 1-Yr | Inc 1-Yr |
|---|---|---|---|---|---|---|---|---|---|
| PFC | Power Finance CorpFinancial Institution | 1.38 LCr | 1.01 LCr | +1.28% | +3.30% | 4.66 | 1.36 | +16.56% | +18.69% |
| RECLTD | RECFinancial Institution | 1.14 LCr | 53.79 kCr | +0.90% | -5.24% | 7.28 | 2.12 | +19.22% | +19.20% |
| HUDCO | Housing &Urban Development CorpFinancial Institution | 45.32 kCr | 9.69 kCr | +13.50% | -0.75% | 16.9 | 4.68 | +27.17% | +30.45% |
| IREDA | Indian Renewable Energy Development AgencyFinancial Institution | 45.12 kCr | 6.23 kCr | +4.55% | -1.62% | 29.41 | 7.24 | - | - |
| LICHSGFIN | Lic Housing FinanceHousing Finance Company | 33.52 kCr | 27.75 kCr | +8.09% | -7.85% | 6.51 | 1.21 | +3.71% | +5.71% |