Indian Railway Finance Corporation (IRFC) will open its maiden initial public offer (IPO) subscription on 18 January. It plans to raise around Rs 4,633 crore through the IPO. IRFC, a dedicated market borrowing arm of the Indian Railways, has set a price band of ₹25 to ₹26 per equity share. The issue will close on 20 January. Bids can be made for a minimum of 575 equity shares and in multiples of 575 shares following that. IRFC is offering up to 178 crore equity shares of the face value of Rs 10 each. This is the first time that a PSU enterprise is using the anchor-investor route. Anchor investors are institutional investors who are offered shares in an IPO a day before the offer opens. Market regulator SEBI had introduced the concept of anchor investors in IPOs in 2009.
IRFC is registered with the Reserve Bank of India as an NBFC and is classified under the category of an ‘Infrastructure Finance Company’ of the Reserve Bank of India Act.
Should you subscribe to the IRFC IPO?
Seeing the market trend in recent times, this issue is expected to award the investors. Although the dates of IRFC IPO will clash with Indigo Paint IPO. As per analysts, investors with a medium or long term view may find it suitable. Companies that are associated with Indian Railways have performed fairly well in the stock markets. Indian Railway Catering And Tourism Corp (IRCTC) launched its IPO with a price band of Rs 315- Rs 320 per share in October 2019. Today, its shares are trading at Rs 1,450
IRFC IPO details
- IPO opening date: 18 January 2021
- IPO closing date: 20 January 2021Face value: Rs10 per equity share
- IPO price: Rs 25 to Rs 26 per equity share
- Minimum order quantity: 575 shares
Upcoming IPOs in 2021 in India
Apart from IRFC and Indigo Paints, other companies lined up to hit the capital markets with initial public offers are Home First Finance Company, Life Insurance Corporation (LIC), Kalyan Jewellers and Barbeque Nation.
Indian Railway Finance Corporation known as IRFC is a finance arm of the Indian Railways. It raises financial resources for expansion and running through capital markets and other borrowings. IRFC started borrowing from the market in 1987–88. It raises money through financial bonds and from banks and financial institutions.