IRFC Share (Indian Railway Finance Corporation) commenced trading on the NSE at Rs 50 and experienced a decline of nearly 6%. Presently, the stock is trading at Rs 49.2, reflecting a 4% decrease. Analyst Sumeet Bagadia from Choice Broking mentioned that the stock might witness profit booking and a corrective movement from its current levels. The projected trading range for the stock is between Rs 52 and Rs 47. The government presently holds an 86.36% stake in IRFC, the financing subsidiary of Indian Railways.
A recent PTI report has revealed that a government official shared details about an inter-ministerial group (IMG) consisting of senior officers from the Department of Investment and Public Asset Management (DIPAM) and the Railways Ministry. This group has started discussions to determine the extent of stake reduction. The aim is to meet the minimum public shareholding (MPS) requirement set by Sebi. The government needs to decrease its current 11.36% stake in IRFC to adhere to the MPS norm, which mandates a minimum public float of 25% within five years of listing.
The official stated that they are assessing investor interest before finalizing the exact dilution percentage. At the present market price, selling 11.36% of the stake would generate around Rs 7,600 crore for the government. The share sale plan includes both issuing new company shares and an additional 4.55% stake dilution by the government.
In terms of historical performance, IRFC Share reached an all-time high of Rs 52.70 in early trade on August 16, 2023. The stock price has surged by over 50% this month, as indicated by Trendlyne data as of July 17, 2023. IRFC became listed on stock exchanges in January 2021. In the quarter ending June, IRFC reported a net profit of Rs 1,557 crore, marking a 6% decline from the Rs 1,660 crore recorded in the corresponding quarter of the previous fiscal year.
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