SlideShare a Scribd company logo
Share Price Analysis
Brief about Indian Railway Finance
The company was incorporated as Indian Railway Finance Corporation Limited
on December 12, 1986, as a public limited company under the Companies Act,
1956, pursuant to a certificate of incorporation issued by the Registrar of
Companies, National Capital Territory of Delhi & Haryana (RoC). Indian Railway
Finance Corporation is wholly-owned by the Government of India acting through
the MoR. It is registered with the Reserve Bank of India as a NBFC
(Systematically Important) and is classified under the category of an
‘Infrastructure Finance Company’ under Section 45-IA of the Reserve Bank of
India Act, 1934. It was notified as a ‘Public Financial Institution’ under the
Companies Act, 1956 through a notification dated October 8, 1993 issued by the
Ministry of Corporate Affairs.
More about IRFC
The company is responsible for raising the finance necessary for such
activities. Over the last three decades, it has played a significant role in
supporting the capacity enhancement of the Indian Railways by financing
a proportion of its annual plan outlay. The company follows 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,
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 incremental borrowing and a margin
determined by the MOR in consultation with it at the end of each Fiscal.
Ratio Analysis
Strengths of the Company
The company is trading at 0.68 times the book value
Operating Income has grown well for the company over past 3
years: 3 years CAGR 22.17%.
The company has delivered substantial profit growth of 0% over
past 3 years.
Promoters shareholding is 86.36%.
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IRFC share price analysis.pdf

  • 2. Brief about Indian Railway Finance The company was incorporated as Indian Railway Finance Corporation Limited on December 12, 1986, as a public limited company under the Companies Act, 1956, pursuant to a certificate of incorporation issued by the Registrar of Companies, National Capital Territory of Delhi & Haryana (RoC). Indian Railway Finance Corporation is wholly-owned by the Government of India acting through the MoR. It is registered with the Reserve Bank of India as a NBFC (Systematically Important) and is classified under the category of an ‘Infrastructure Finance Company’ under Section 45-IA of the Reserve Bank of India Act, 1934. It was notified as a ‘Public Financial Institution’ under the Companies Act, 1956 through a notification dated October 8, 1993 issued by the Ministry of Corporate Affairs.
  • 3. More about IRFC The company is responsible for raising the finance necessary for such activities. Over the last three decades, it has played a significant role in supporting the capacity enhancement of the Indian Railways by financing a proportion of its annual plan outlay. The company follows 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, 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 incremental borrowing and a margin determined by the MOR in consultation with it at the end of each Fiscal.
  • 5. Strengths of the Company The company is trading at 0.68 times the book value Operating Income has grown well for the company over past 3 years: 3 years CAGR 22.17%. The company has delivered substantial profit growth of 0% over past 3 years. Promoters shareholding is 86.36%.