Insights

Indian Railway Finance Corporation (IRFC) IPO opens on January 18, 2021

January 17, 2021 . Manas muraleedharan

The Indian Railway Finance Corporation IPO is the talk of the investment town. With hopes pinned on 2021, a good many are finally starting to understand the importance of investments. This blog is here to educate you on why you should invest in IRFC IPO.

But first, let’s see why you should go for an IPO, instead of buying the shares that are already well into the trade cycle.

Why Invest in an IPO?

An IPO investment is more suited for a long-term investment. This is the case where you locate a good company, find out its scope and buy the initial offering at low prices. As years pass and the company carves a niche for itself, the shares you bought will be occupying a big, fat value. So when you hear of an IPO, inspect the company’s prospects and its validity and scope for sustenance in the future. If it scores well on all aspects, Do Not Miss Out on it! As for the news of IPOs, do not worry about that. We’ll keep you updated on the upcoming IPOs, so that you can invest in promising companies.

Indian Railway Finance Corporation (IRFC)

IRFC was incorporated in 1986 and is a public sector enterprise. At present, IRFC’s financing of Indian Railways has been utilised for

Incorporated in 1986, the Indian Railway Finance Corporation (IRFC) is a public-sector enterprise that is wholly-owned by the Government of India. IRFC is primarily engaged in financing the acquisition of rolling stock assets, leasing of railway infrastructure assets, and lending to entities under the Ministry of Railways (MoR). IRFC is responsible to raise funds for MoR that is required to procure rolling stock assets (wagons, trucks, electric multiple units, locomotives, coaches), its improvement, expansion, and assets management.

Let’s take the actual expenditure of Indian Railways in 2019 – it was Rs. 1,334 billion. Of this, Rs 525.35 billion (39.34%) was financed by IRFC.

Competitive strengths

  • Critical role in the growth of Indian Railways
  • Sound credit rating of AAA/A1+ by CRISIL and ICRA 
  • Competitive cost of borrowing
  • Strong financial performance
  • Good asset-liability management
  • Well-experienced Management

Here’s a summary of the Company’s Financials:

ParticularsFor the year/period ended on 30-Sep-19
(₹ in million)
For the year/period ended on 31-Mar-19
(₹ in million)
For the year/period ended on 31-Mar-18
(₹ in million)
For the year/period ended on 31-Mar-17
(₹ in million)

Total Assets
2,383,6642,066,0361,614,6841,287,503

Total Revenue
66,612111,33592,68380,137

Profit After Tax
17,14722,54620,4909,211

Company Promoters:

The President of India acting through the Ministry of Railways (MoR) is the promoter of the company.

Utilisation of IPO proceeds

  • Augmentation of the company’s equity capital base to meet business future growth requirements
  • To meet general corporate purposes

Now that you have a fair view of the company’s scope and soundness, we don’t want to keep you any longer. Visit www.fundsindia.com to buy the IPO of IRFC.

Get FundsIndia’s articles delivered straight to your inbox!

Enter your email address to get:

  • Mutual fund recommendations from experts
  • Buy, hold or sell calls for stocks
  • Investment tips and tricks
  • All the latest news from Fundsindia.com

[jetpack_subscription_form]

sek