IRFC Share Price Falls as Government Caps OFS at 2%; Secures $400 Million ECB

Government Declines Oversubscription Option in IRFC OFS

The Government of India, acting as the promoter through the Ministry of Railways, informed stock exchanges that it will not exercise the oversubscription option under its ongoing Offer for Sale (OFS).

The OFS initially comprised a base offer size of 26,13,70,120 equity shares, representing 2% of IRFC’s total paid-up equity capital. An additional 2% was available under a green shoe option. However, after the first day of bidding (T Day), which was reserved for non-retail investors, the issue recorded an under-subscription of 1,18,04,243 shares.

As a result, the total offer size will remain restricted to the base 2% stake. For the final day of the offer (T+1 day, February 26, 2026), 3,79,41,255 shares have been allocated for the retail category, representing approximately 14.52% of the total offer. Additionally, 25,000 equity shares, accounting for 0.0002% of the total equity, have been reserved for eligible IRFC employees under the employee offer.

IRFC Share Price Fall 5%, Hovering Near OFS Floor Price

IRFC share Price declined over 1.59% to ₹102.90 on the NSE on February 26, trading below the OFS floor price, extending yesterday’s losses over 5%. The stock has underperformed the broader market, falling 15% over the past one year, compared to a 13% gain in the Nifty during the same period.

Technically, the stock is trading below its 50-day simple moving average (SMA) and its 200-day SMA.

$400 Million ECB Signed via GIFT City

Parallel to the stake sale development, IRFC signed a loan agreement in New Delhi to raise an External Commercial Borrowing for a JPY equivalent of $400 million. The facility has been arranged through a consortium comprising Sumitomo Mitsui Banking Corporation (SMBC) and MUFG Bank Ltd., both operating through their GIFT City branches.

The loan carries a five-year tenor and is benchmarked to the Overnight TONAR (Tokyo Overnight Average Rate). This transaction marks IRFC’s second ECB in the financial year 2025-26, following a $300 million JPY-equivalent borrowing secured in December 2025.

The proceeds from the loan will be utilized to finance projects with forward or backward linkages to the railway sector, as well as other company-approved projects in compliance with ECB guidelines.

Summary

Overall, while the government’s decision to cap the OFS at 2% reflects subdued institutional participation, IRFC’s continued access to international funding and record earnings underscore its ongoing financial expansion and operational strength.