IRFC Share Price
IRFC Share Price: Indian Railway Finance Corporation
Indian Railway Finance Corporation (IRFC) is a corporation founded in 1986 and owns all of Indian Railways. Indian Railway Finance Corp is a private financing arm of Indian Railways that mobilizes funds from domestic and international capital markets. However, IRFC started to borrow from the market between 1987-1988.
The IRFC is an organization that raises financial bonds and money from banks and financial institutions. The company’s initial public offering was announced earlier this year on January 18, 2021. It was listed on the National Stock Exchange of India / Bombay Stock Exchange on January 29 after the IPO.
IRFC owns 8998 locomotives, 47910 passenger coaches and 214456 wagons, which make up 70% of Indian Railways’ rolling stock. In addition, the company has been given the task of financing Railway Projects through Corporate Finance for a certain fee until 2019-20. The IRFC provides loan services to various entities in many Railroad industries.
Indian Railway Finance Corporation announced a 15 percent increase in net profit for the third quarter. In the nine-month period ending on December 31, it reported an increase of 15.65 in net profit. IRFC share price is traded at 23.90.
IRFC Share Price: Financial Development of IRFC
The IRFC’s financial development over the past five years clearly demonstrates great improvement in the company. During this period, the company’s total revenue increased by 12,99%. After tax, net profit saw a 33.95% increase. In addition, IRFC’s total assets improved by 16.04%. Long-term debt has increased by 26.35% and while borrowing long-term debt, there is a lease agreement with the CB to repay the debt.
IRFC has a unique and special business model that cannot be compared to other industries. In addition, its financial performance is proof that it has good investment power after the IPO.
In 2017, it is included in the IRFC in the list of 5 railway companies approved by the Union Cabinet. Before moving on to the SWOT analysis of the IRFC, let’s examine the Indian railways.
Indian Railways is spread over a very large area and in addition, it is the world’s largest network for ferry passengers and the fourth largest for cargo. India also has the world’s largest rail network in Asia. However, in order to facilitate and revise the access of the Railways, the Ministry of Railways has received Rs.15 lakh crore from the Union Government. IRFC is a mobile asset provider for Indian Railways.
Strengths of IRFC
Indian Railway Finance Corporation is a private market borrowing arm. It therefore plays a strategic role in financing the growth of Indian Railways. Diversity in financing sources and the strongest credit rating in India allow it to offer a competitive borrowing cost.
It has a standard agreement with Indian Railways which has ensured it has been performing consistently over the years and has a steady income. IRFC has a low risk business model. The IRFC follows an asset and liability management strategy where it minimizes the mismatch between its assets and liabilities.
IRFC has a senior management team that is experienced and open to the private and government sectors in order to ensure customer satisfaction and success.
Weaknesses of IRFC
The biggest weakness is that the IRFC’s revenue comes from Indian railways. The reason this is a weakness is that the growth of IRFC is dependent on railroads. Also, profitability of IRFC may occur if MoR considers margin on costs as profit.
This is not a financial advice. You must make your own decisions and you are responsible for your decisions.