IPO Details
Below are key details about the IPO of the Company
- IPO Start Date – 18th Jan 2021
- IPO End Date – 20th Jan 2021
- IPO Listing Date – 29th Jan 2021
- IPO Price – INR 25 – 26
- IPO Lot Size – 575
- Minimum investment required – INR 14,950
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Business Details
IRFC stands for Indian Railway Finance Corporation. The Company was incorporated in year 1986 and is registered as non deposit taking Non Banking Financial Company (NBFC) with Reserve Bank of India. So you can view it as a NBFC.
The main business of Company is to borrow funds from Capital market to fund the requirements of Indian Railways. The business operations can be divided into three parts.
- Borrowing
- It borrows money from taxable and taxfree bond issuances, term loans from banks and FIs and ECB.
- The objective is to have low cost borrowing.
- Lending
- It also funds Railway projects as well.
- For example it funds projects of RVNL, Railtel Corporation and other subsidiaries of Indian Railway.
- Leasing
- The Company follows leasing model for financing Indian Railways.
- it has funded acquisition of 8998 locomotives, 47910 passenger coaches, 2,14,456 wagons.
The NBFC has highest rating from Credit Rating Agencies which is positive for the Company. Below are some important key points about the Company performance over the years
- PAT has CAGR of 16%
- Net Worth has CAGR of 17%
- Revenue has CAGR of 13%
Financial Snapshot
Below are key financials of the Company for year ending 2019 (Rupee in million)
- Total Assets – 29,19,865
- Total Revenue – 73,848
- Total Expense – 54,980
- Profit for year – 18,868
IPO Subscription Status
Below is IPO Subscription status of the Company. I will be updating this section with time.
- QIB – 3.78 times
- NII – 2.67 times
- RII – 3.66 times
- Employee – 43.76 times
- Total Subscription is 03.49 times
Below is meaning of the Key terms used above
- QIB is (Institutes or Mutual Funds like HDFC AMC etc)
- NII is (People bidding for more than 2 lakhs in IPO application)
- RII is (People bidding for less than 2 lakhs)
- Employee and Others are Reserved Quota Investors.
My Opinion
IRFC Limited is an interesting Company to say the least. It is one of those rare NBFC which has Zero debt as it serves Government of India. The Company finances Indian Railways which is mainstay of Infrastructure.
Railways are very important and critical for economy growth of Country as it is one of the cheapest mode of transportation available in the country. In country as big as India for good connectivity Railways is very important.
IRFC is one those Companies which will fund the subsidiaries of the Railways. The number of Employees is very less (24 to be precise at of now) which also makes it one of the lightest model NBFC.
Above points may propel higher subscription for this IPO and It may get oversubscribed in my opinion.