Synopsis:
IRFC awarded a USD 300 million ECB mandate to SMBC’s GIFT City branch for a 5-year term with bullet repayment. The funds will be used under RBI’s ECB norms. The stock dipped 2.35 percent intraday. QoQ revenue and profit grew 2.9 percent and 3.8 percent respectively in Q1FY26.
A financial PSU stock was in focus after it secured a fresh offshore funding line through an external commercial borrowing arrangement. The development comes amid a broader push to diversify funding sources and support long-term capital requirements.
IRFC, which has a market capitalization of Rs. 1,69,080 crore, opened at Rs. 130.09 against the previous close of Rs. 131.40. The stock touched an intraday low of Rs. 128.30, marking a 2.35 percent decline from the previous close.
What’s the News?
Indian Railway Finance Corporation has finalised an agreement with SMBC, GIFT City Branch, for raising a JPY equivalent USD 300 million External Commercial Borrowing (ECB) with a 5-year tenor. The repayment of principal will be made as a bullet payment and interest will be paid on a semi-annual basis.
The ECB proceeds will be used in accordance with Reserve Bank of India’s ECB guidelines. The deal was formalised through a Letter of Award issued by IRFC to the successful L1 bidder.
Also Read: Infra stock in focus after company’s net profit increases 37% YoY
Financial Snapshot
As of March 2025, the company had a Return on Capital Employed (ROCE) of 5.83 percent, Return on Equity (ROE) of 12.8 percent, and Return on Assets (ROA) of 1.34 percent. The stock is currently trading at a price-to-earnings ratio of 25.3, compared to the industry average of 25.7.
The debt-to-equity ratio stood at 7.44, which is typical given the company’s role as a financial arm of Indian Railways. IRFC had cash equivalents of Rs. 6,143 crore and reported a net cash flow of Rs. 5,658 crore at the end of FY25.
During the June 2025 quarter, revenue rose from Rs. 6,723 crore to Rs. 6,915 crore, while net profit increased from Rs. 1,682 crore to Rs. 1,746 crore, marking a quarter-on-quarter growth of 2.9 percent in revenue and 3.8 percent in profit.
About the Company
Indian Railway Finance Corporation (IRFC) is a public sector enterprise under the administrative control of the Ministry of Railways. It plays a crucial role in mobilising financial resources for the Indian Railways through market borrowings. In March 2025, IRFC was granted Navaratna status by the Government of India.
Established in 1986, the company primarily finances the acquisition of railway assets and leases them to Indian Railways under a finance lease structure. The Government of India holds a majority stake in the firm, and its shareholding pattern has remained largely stable in recent quarters.
Written By Manan Gangwar
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