Indian Railway Finance Corporation (IRFC) is likely to draw investor attention after the government confirmed it will not proceed with the oversubscription option in the ongoing Offer for Sale (OFS).
The decision follows lower than expected demand during the institutional bidding phase, signalling cautious participation despite the company’s steady financial performance and strategic role in railway financing.
The government has decided against exercising the green shoe option linked to IRFC’s Offer for Sale after the issue did not receive full subscription on the opening day of bidding for non-retail investors.
The additional 2% equity sale was contingent on stronger demand, which did not materialise during the initial phase of the offering.
Regulatory disclosures indicated that the subscribed portion fell short of the shares on offer, leading to the withdrawal of the oversubscription component.
The OFS was structured to divest up to a 4% stake in IRFC, with an initial tranche representing a 2% equity sale. The floor price for the issue was set at ₹104 per share, implying a sizeable disinvestment value at the announced pricing level.
A small portion of shares was also earmarked for eligible employees under the offering framework, reflecting standard allocation practices in such transactions.
IRFC shares witnessed selling pressure during the session, closing lower following developments around the OFS subscription levels.
Market participants typically interpret subscription trends as an indicator of institutional appetite, which can influence near-term sentiment around divestment-driven supply in the market.
The stock has also been trading below key moving averages, reflecting subdued momentum over recent months compared with broader benchmark indices.
IRFC serves as the dedicated financing arm of Indian Railways, raising funds from domestic as well as international markets to support railway infrastructure and rolling stock requirements. The company operates as a Navratna public sector enterprise under the administrative oversight of the Ministry of Railways.
Despite share price weakness, the company has reported consistent financial growth. For the quarter ended December 2025, IRFC recorded its highest quarterly profit to date, supported by stable loan expansion and improved interest margins. Growth in income has been aided by diversified disbursements and liability management measures.
Indian Railway Finance Corporation Limited shares closed at ₹104.56 in the previous trading session, based on NSE market data dated 25 February 2026.
The government’s decision not to exercise the green shoe option concludes the additional share sale possibility under the current OFS structure. While the development reflects moderate investor participation in the offering, market attention may continue to focus on IRFC’s operational performance and funding role within India’s railway infrastructure ecosystem.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks. Read all related documents carefully before investing.
Published on: Feb 26, 2026, 9:07 AM IST
Neha Dubey
Neha Dubey is a Content Analyst with 3 years of experience in financial journalism, having written for a leading newswire agency and multiple newspapers. At Angel One, she creates daily content on finance and the economy. Neha holds a degree in Economics and a Master’s in Journalism.
Know MoreWe're Live on WhatsApp! Join our channel for market insights & updates
Get the link to download the App
