IRFC OFS: Retail Investors Can Now Bid for Rs 2,212 Crore Stake Sale
The Indian government's Offer for Sale (OFS) in Indian Railway Finance Corporation (IRFC) has moved into its next phase as the window opens for retail investors today. Following a highly successful debut for institutional investors, this disinvestment move aims to offload a significant stake at a discounted floor price.
Details of the Rs 2,212 Crore OFS
The government is offloading nearly a 2% stake in IRFC. While the initial plan involved selling a 1% stake (13.06 crore shares), the Department of Investment and Public Asset Management (DIPAM) has decided to exercise the greenshoe option due to massive demand.
The total offer size has now been revised to 24.31 crore shares, representing a 1.86% stake. At the set floor price of Rs 91 per share, the total value of the sale exceeds Rs 2,212 crore. For retail investors, 2.43 crore shares are available for subscription, while a smaller portion of 25,000 shares is reserved for eligible employees.
Strong Institutional Demand and the Greenshoe Option
The OFS saw immediate momentum on Wednesday when it opened for non-retail investors. The institutional portion was subscribed 1.86 times on the very first day. This robust interest prompted DIPAM Secretary Arunish Chawla to confirm that the government would exercise the greenshoe option to sell an additional 11.24 crore shares.
The floor price of Rs 91 per share offers a modest discount of approximately 2% compared to the stock's previous closing price of Rs 92.5 on the NSE. This disinvestment is part of a broader trend as the central government continues its push to offload stakes in various Public Sector Undertakings (PSUs), including Coal India, NHPC, and NLC India.
Stock Performance and Financial Health
Despite the positive subscription numbers, IRFC’s stock has faced recent volatility. The shares tumbled more than 6% on Wednesday following the opening of the OFS and have seen a decline of roughly 27% in 2026 so far. However, looking at a longer horizon, the company has been a strong performer, delivering 185% returns over three years and 272% over five years.
On the fundamental side, IRFC's Q4 (ending March 2026) results showed stability. The company reported a net profit of Rs 1,684 crore, consistent with the Rs 1,682 crore reported in the same quarter the previous year. Revenue for the quarter grew by 9% year-on-year, reaching Rs 7,336 crore.
Shareholding Pattern
As of March 31, 2026, the central government maintains a dominant position with nearly an 85% stake in IRFC. Other significant holders include the Life Insurance Corporation of India (LIC) with a 2.54% stake and 24 mutual funds which collectively hold 0.27%. The remaining retail and public shareholders account for approximately 10% of the company.
Key Takeaways
- Expanded Offering: Due to 1.86x subscription by institutions, the government is exercising the greenshoe option, increasing the total stake sale to 1.86%.
- Retail Opportunity: Retail investors can bid for 2.43 crore shares at a floor price of Rs 91 per share.
- Disinvestment Trend: The sale is part of a larger government strategy to raise capital through PSU disinvestment, following similar moves in the energy and insurance sectors.