Govt mulls stake sale in Indian Railway Finance Corp through OFS route: Report
New Delhi: The government is considering selling a portion of its stake in the state-owned Indian Railway Finance Corp (IRFC) during the current fiscal year through an offer for sale (OFS), a report in the media said.
Presently, the government holds an 86.36 percent stake in the financing subsidiary of the Indian Railways.
An inter-ministerial group (IMG), comprising senior officials from the Department of Investment and Public Asset Management (DIPAM) and the Railways Ministry, has initiated discussions to determine the extent of stake reduction.
To adhere to the Securities and Exchange Board of India's (Sebi) minimum public shareholding (MPS) requirement, the government must reduce its stake in IRFC by 11.36 percent.
Under the MPS rule, a listed entity must maintain a minimum public float of 25 percent within five years of listing.
At the current market value, selling 11.36 percent would generate around Rs 7,600 crore for the government, said the report.
IRFC was listed on stock exchanges in January 2021.
The offering involved both a fresh issuance of shares by the company and an additional 4.55 percent stake reduction by the government.
In the quarter ending June, IRFC reported a net profit of Rs 1,557 crore, registering a 6 percent decrease from Rs 1,660 crore in the same quarter of the previous fiscal year.
IBNS
Senior Staff Reporter at Northeast Herald, covering news from Tripura and Northeast India.
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