The shares of one of the leading PSU stock, under the Ministry of Railways, which specializes in financing Indian Railways, are in focus upon Rs. 7,500 Crore Bid Acceptance by NTPC Renewable Energy Limited.
Price action
With a market capitalization of Rs. 1,62,114.82 crores on Monday, the shares of Indian Railway Finance Corporation Limited (IRFC) down by upto 1.9 percent making a low of Rs. 122.55 per share compared to its previous closing price of Rs. 125.00 per share.
What Happened
Indian Railway Finance Corporation Limited (IRFC) specializing in raising funds through debt instruments such as bonds and loans to support the Indian Railways are in focus as NTPC Renewable Energy Limited (NTPC REL), a subsidiary of NTPC Green Energy Limited, has accepted IRFC’s bid of Rs. 7,500 crores for financing a Rupee Term Loan (RTL) as per their Request for Proposal dated January 17, 2025.
Future Outlook
The management is optimistic about future growth, anticipating significant increases in PAT from non-railway businesses. Margins from these projects are expected to be 3 to 5 times higher than those from Railway projects and the company aims to maintain AUM levels while shifting its focus towards more profitable assets.
AUM Break-Up (HY1 FY 25)
In HY1 FY25, IRFC’s AUM breakup consists of Lease Receivables (34.02 percent), Project Assets (20.03 percent), and Advances against Railway Infrastructure Assets to be leased (44.98 percent) and a small portion of 0.97 percent, loaned to RVNL and 99.03 percent of the AUM was allocated to Ministry of Railways (MoR).
Financials
The company’s total revenue rose by 0.3 percent from Rs. 6,745.31 crores to Rs. 6,766.39 crores in Q3FY24-25. Meanwhile, Net profit rose from Rs. 1,604.23 crores to Rs. 1,630.66 crores during the same period.
Written by Sridhar J
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