Indian Railway Finance / IRFC IPO – Review, Allotment Status, Subscription, Price, Date
Let’s have a detailed review of the company and analytics of the Indian Railway Finance Limited IPO or IRFC IPO release date, IPO offer price, subscription, Indian Railway Finance Corporation IPO allotment, grey market price and other details like the company’s background, its financial positions, its promoters and other related things.
|Face Value||Rs 10|
|Price Band||Rs 25 – 26|
|Listing At||BSE, NSE|
|Min. Order Quantity||575|
|Listing Date||Jan 29, 2021|
|Offer for Sale||Rs 8887.2 MILLION|
|Fresh Issue||Rs 2650 MILLION|
|IPO Size||Rs 4,633.38 Cr|
|Tick Size||Rs. 1|
Indian Railway Finance IPO or IRFC IPO is listed at NA premium, check out the live share price by clicking on the below link.
Summary of Indian Railway Finance IPO
They are the dedicated market borrowing arm of the Indian Railways. Their primary business is financing the acquisition of rolling stock assets, which includes both powered and unpowered vehicles. For example – locomotives, coaches, wagons, trucks, flats, electric multiple units, containers, cranes, trollies of all kinds.
Other items of rolling stock components as enumerated in the Standard Lease Agreement (collectively, “Rolling Stock Assets”), leasing of railway infrastructure assets and national projects of the Government of India (collectively, “Project Assets”) and lending to other entities under the Ministry of Railways, Government of India (“MoR”).
The Promoters of this company are THE PRESIDENT OF INDIA, ACTING THROUGH THE MINISTRY OF RAILWAYS, GOVERNMENT OF INDIA (“MoR”). The lead managers to the issue are IDFC Securities Limited, HSBC Securities and Capital Markets (India) Private Limited, ICICI Securities Limited and SBI Capital Markets Limited . The Registrar to this issue is KFin Technologies Private Limited.
Indian Railway Finance IPO or IRFC IPO Dates
The opening and the closing date of Indian Railway Finance IPO is Jan 18, 2021 and Jan 20, 2021.
Indian Railway Finance IPO or IRFC IPO Subscription
|Day / Date||QIB||NII||RII||Employee||Total Subscription|
|1st Day – Jan 18||0.00x||0.09x||1.25x||13.54x||0.65x|
|2nd Day – Jan 19||0.00x||0.24x||2.22x||27.41x||1.22x|
|3rd Day – Jan 20||3.78x||2.67x||3.66x||43.76x||3.49x|
|Shares Offered or Net Issue||356,375,339||267,281,504||623,656,843||192,307||1,247,505,993|
The shares subscribed by the public will be updated here.
Indian Railway Finance IPO or IRFC IPO Allotment Status
Here, you can find the Allotment Status of this IPO. Allotment of Equity Shares pursuant to the Fresh Issue and transfer of the Offered Shares of the Promoter Selling Shareholders pursuant to the Offer for Sale to the successful Bidders. However, the Allotment status is not yet disclosed.
|Basis of Allotment Finalization||Jan 25, 2021|
|Refunds Initiation||Jan 27, 2021|
|Credit of Shares to Demat Account||Jan 28, 2021|
|Share Listing Date||Jan 29, 2021|
Indian Railway Finance IPO Price Band / Cash Price
The face value of each share is Rs.10, and the cash price of the IPO is Rs.25 – 26.
Indian Railway Finance IPO or IRFC IPO Size
This Initial Public Issue of 1,407,069,000 Equity Shares of Rs.10 each for cash at a price of Rs.25 – 26 per equity share aggregating to Rs.4,633.38 Cr.
Indian Railway Finance IPO Share Offering
Fresh Issue: The Fresh Issue of 938,046,000 Equity Shares by their Company of Rs.10 each at a price of Rs.25 – 26 per equity share aggregating to Rs.[●] million,
Net Issue : The Net Issue of [●] Equity Shares of Rs.10 each at Rs.25 – 26 per Equity Share aggregating to Rs.[●] million.
Offer for Sale : Offer for sale of up to 469,023,000 Equity Shares by the Promoter Selling Shareholder aggregating up to Rs.[●] Million.
Indian Railway Finance IPO / IRFC IPO – Live Performance
The listing date of this IPO is Jan 29, 2021. You can check the live performance of the IPO here, only after it is listed on exchanges.
Indian Railway Finance IPO Grey Market Premium
The Indian Railway Finance Limited IPO or IRFC IPO Grey Market Premium price is Rs 1.10-1.20, the Kostak rate is Rs 400 and the Subject to Sauda is Rs. 600.
IRFC IPO – Promoter Holding
- Pre Issue Share Holding – 100%
- Post Issue Share Holding – 86%
Indian Railway Finance Limited – Company Overview
Over the last three decades, they have played a significant role in supporting the capacity enhancement of the Indian Railways for instance by financing a proportion of its annual plan outlay. In addition to that, they are wholly-owned by the Government of India acting through the MoR.
They are registered with the Reserve Bank of India as a NBFC (Systematically Important) and are classified under the category of an “Infrastructure Finance Company” under Section 45-IA of the Reserve Bank of India Act, 1934. The Company is notified as a “Public Financial Institution” under the Companies Act, 1956 likewise through a notification dated October 8, 1993 issued by the Ministry of Corporate Affairs.
Indian Railway Finance Leasing Model
They follow a financial leasing model for financing the Rolling Stock Assets. The period of lease with respect to Rolling Stock Assets is typically 30 years comprising a primary period of 15 years followed by a secondary period of 15 years in the same way, unless otherwise revised by mutual consent.
In terms of the leasing arrangements, the principal amount pertaining to the leased assets is effectively payable during the primary 15 years lease period, along with the weighted average cost of borrowing and a margin determined by the MOR in consultation with them at the end of each Fiscal.
Typically, the weighted average cost of borrowing factors in any expenses incurred by them with respect to any foreign currency hedging costs and/ or losses (and gains, if any) as well as any hedging costs for interest rate fluctuations. For the second 15 year period, they charge the Indian Railways a nominal rate which is subject to revision on mutually acceptable terms.
They also follow a leasing model for Project Assets, which consequently provide for lease periods of 30 years. As of September 30, 2019, their total AUM, consisted of 60.80% of lease receivables primarily in relation to Rolling Stock Assets, 2.56% of loans to central public sector enterprises entities under the administrative control of MoR (“Other PSU Entities”), and 36.64% of advances against leasing of Project Assets.
Indian Railway Finance – Standard Lease Agreement
For all the Rolling Stock Assets acquired during a financial year by Indian Railways, and as a result, they enter into a lease agreement with the MoR following the close of each respective Fiscal (the “Standard Lease Agreement”).
Lease rentals include the value of the Rolling Stock Assets leased by them to the MoR in the relevant fiscal year. In the same way, the weighted average cost of borrowing as well as a certain margin, all in accordance with the terms of the Standard Lease Agreement.
In Fiscal 2019, they were entitled to a margin of 40 bps over the weighted average cost of borrowing for financing Rolling Stock Assets and a spread of 35 bps over the weighted average cost of borrowing for financing Project Assets over the weighted average cost of borrowing.
Indian Railway Credit Rating
They maintain the highest possible credit ratings consequently, for an Indian issuer both for domestic and international borrowings. They have received the highest credit ratings from CRISIL – CRISIL AAA and CRISIL A1+, ICRA – ICRA AAA and ICRA A1+, and CARE – CARE AAA and CARE A1+.
The Company also been accorded with Baa2 (Negative) rating by Moody’s, BBB- (Stable) rating by Standard and Poor’s, BBB- (Stable) rating by Fitch and BBB+ (Stable) rating by Japanese Credit Rating Agency that are on par with India’s sovereign ratings.
Indian Railway Finance / IRFC IPO – Financial Statements
On the basis of Standalone statement:
|Amount (in INR & Million)|
|Profit After Tax||18,868.41||16,303.93||31,920.96||21,399.33||20,014.60|
Earnings per Equity Share (in Million)
|Amount (in INR & Million)|
|Basic & Diluted||1.59||1.74||3.40||3.26||3.07|
From FY 2017-18 to FY 2019-2020, as per the Restated Financial Statements
- Our total revenue from operations increased by 19.33% from Rs.92,078.39 million in Fiscal 2018 to Rs.109,873.55 million in Fiscal 2019 and by 22.15% to Rs.134,210.90 million in Fiscal 2020, and was Rs.73,848.29 million in the six months ended September 30, 2020.
- In Fiscals 2018, 2019 and 2020, and the six months ended September 30, 2020, our profit for the period was Rs.20,014.60 million, Rs.21,399.33 million, Rs.31,920.96 million and Rs.18,868.41 million, respectively.
Indian Railway Finance IPO – Promoters
The Promoters of this company are:
- THE PRESIDENT OF INDIA
- ACTING THROUGH THE MINISTRY OF RAILWAYS
- GOVERNMENT OF INDIA (“MoR”)
List of Related Parties (Key Managerial Personnel)
- Vijay Babulal Shirode, Company Secretary and Compliance Officer
- Ashutosh Samantaray, Additional General Manager (Finance)
- N.H. Kannan, General Manager (Finance)
- Prasanta Kumar Ojha, General Manager (Finance)
Indian Railway Finance Limited: Key Strength
- Strategic role in financing growth of Indian Railways
- Competitive cost of borrowings based on strong credit ratings in India and diversified sources of funding
- Consistent financial performance and cost plus model
- Low risk business model
- Strong asset-liability management
- Experienced senior management and committed team
Indian Railway Finance IPO Offer Details / IRFC IPO Issue Details
|Particulars||No. Of Equity Shares|
|Equity Shares Offered||Up to 1,407,069,000 Equity Shares, aggregating up to Rs.[●]million|
|Fresh Issue||938,046,000 Equity Shares, aggregating up to Rs.[●]million|
|Offer for Sale||Up to 469,023,000 Equity Shares, aggregating up to Rs.[●]million|
|Employee Reservation Portion||Up to [●] Equity Shares aggregating up to Rs.5 million*|
|Net Issue||Up to [●] Equity Shares aggregating up to Rs.[●] million*|
|QIB Portion||Not more than [●] Equity Shares|
|Non-Institutional Portion||Not less than [●] Equity Shares|
|Retail Portion||Not less than [●] Equity Shares|
|*Equity Shares outstanding prior to the Issue||11,880,460,000 Equity Shares|
|Equity Shares outstanding after the Issue||13,068,506,000 Equity Shares|
IRFC IPO / Indian Railway Finance IPO Issue Object
These are the IPO Issue Objects of the company:
(1) Augmenting their equity capital base to meet their future capital requirements arising out of growth in their business; and
(2) General corporate purposes.
Indian Railway Finance Limited: Business strategies
- Diversification of borrowing portfolio
- Broaden their financing portfolio
- Continued focus on asset-liability management
- Provide advisory and consultancy services and venture into syndication activities
IRFC IPO / Indian Railway Finance IPO – Basis of Offer Price
The issue price is determined by the company in consultation with the Lead manager on the basis of the following qualitative and quantitative factors.
Qualitative factors are:
- Strategic role in financing growth of Indian Railways;
- Competitive cost of borrowings based on strong credit ratings in India and diversified sources of funding;
- Consistent financial performance and cost-plus model;
- Low risk business model;
- Strong asset-liability management; and
- Experienced senior management and committed team.
Indian Railway Finance IPO – Quantitative Factors
|Basic & Diluted EPS||RONW in %||NAV (Rs.)|
Indian Railway Finance Limited: Competitive Peers
There are no listed companies in India in the same line of business as that of the Company.
Indian Railway Finance IPO Lead Managers
|IDFC Securities Limited|
HSBC Securities and Capital Markets (India) Private Limited
ICICI Securities Limited
SBI Capital Markets Limited
IRFC IPO Registrar to Offer
|Registrar to the Offer|
|KFin Technologies Private Limited|
Selenium Tower-B, Plot 31 & 32, Gachibowli
Financial District, Nanakramguda, Serilingampally
Hyderabad 500 032, Telangana, India
Telephone: +91 40 6716 2222
Investor grievance email: firstname.lastname@example.org
Contact Person: M. Murali Krishna
SEBI Registration No: INR000000221
IRFC IPO – Other Details
- Statutory Auditor – M/s SPMG & Co.
- Legal Counsel to the Company – Khaitan & Co, Squire Patton Boggs Singapore LLP
- Bankers to the Company – Corporation Bank, State Bank of India, ICICI Bank Limited
Indian Railway Finance IPO Review by Top 10 Stock Brokers
|Top Stock Brokers Review||Company Reputation||Competitive Edge||Financial Statement||Popularity Index||Promoters Reputation|
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Indian Railway Finance IPO Review FAQs
Ques – What is the Issue Size of Indian Railway Finance IPO?
Answer – The Company is making an initial public offer of 1,407,069,000 equity shares. We vividly portray the aspects of the issue in this article. You can check the stats on fresh issue, Offer for sale, and the net issue.
Ques – What is the Price band?
Answer – The price band for IRFC IPO ranges between Rs 25 – 26. As far as the face value of the share is of concern, it is Rs.10 per share.
Ques – What is the Indian Railway Finance IPO Open Date?
Answer – The opening and closing date for the IPO have been updated. The IPO is set to open on JANUARY 18, 2021 while the closing date is set at JANUARY 20, 2021.
Ques – What is the IRFC IPO Allotment Date?
Answer – We also have the news regarding the respective allotment dates. Basis of Allotment finalization is on Jan 25, 2021, refund initiation is on Jan 27, 2021, credit of shares is on Jan 28, 2021 and share listing date is on Jan 29, 2021.
Ques – What is the IPO Listing Date?
Answer – Shares of this company shall be listed in the exchanges BSE as well as NSE. Date when the listing would be done is stagnant on Jan 29, 2021.
Ques – Who is the Registrar of this IPO?
Answer – One of the reputed registrars are managing the issue of this IPO, i.e. KFin Technologies Private Limited. Their website will help you regarding the further information you are on a lookout for.
Ques – Who is the Promoter of this Company?
Answer – Here is the promoter of this company – THE PRESIDENT OF INDIA, ACTING THROUGH THE MINISTRY OF RAILWAYS, GOVERNMENT OF INDIA (“MoR”). You can refer to the RHP for further information on the promoter. Consequently, you will find the link to RHP in the article.
Ques – What is GMP of Indian Railway Finance IPO?
Answer – We have obtained the GMP of this IPO and it is 1.50 – 2.0. The further insights of Kostak rate and subject to sauda or SS are as well included in this report.
Ques – Is Indian Railway Finance IPO good for Investment?
Answer – The primary reason is that IRFC is the borrowing arm of Indian railways and is a wholly owned subsidiary of Government. This makes it a desirable option of investment for the investors looking for profitable opportunities and insights. We can project a possible growth in the company based on its positive balance sheet.
Ques – What is the PAT of this Company?
Answer – We have the information of company financials, and according to that, we have the figures from the last few years to provide. In fact, PAT for the financial year 2020 is 31,920.96 million, 2019 is 21,399.33 million, 2018 is 20,014.60 million. Further, PAT from September 2020 is 18,868.41 million.
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