IRFC Share Price Slips Nearly 2% as Government Dilutes 1.86% Stake

IRFC share price slips nearly 2% below the OFC floor price as the retail bidding window officially opened for individual investors

On Thursday, June 25, 2026, shares of Indian Railway Finance Corporation Limited (IRFC) fell nearly 2% during early equity trading. The stock opened at ₹90.81 per share on the BSE, a decline of 1.86% from its previous close. This decline pulled the stock below the government’s official offer for sale (OFS) floor price, which officials had set at ₹91 per share.

The early morning decline continued a multi-day decline for the state-owned company. The equity fell 2.16% on Tuesday and fell a massive 6.24% on Wednesday. Market experts attributed this continued decline to institutional offloading and pricing adjustments related to the massive public divestment program.

The market decline coincided with the opening of individual retail participants to the share sale. The retail bidding phase began on Thursday, following a highly successful institutional order collection on Wednesday, June 24, 2026. On its first day, the non-retail portion of the divestment plan saw strong interest, with the session oversubscribed 1.86 times.

During that initial institutional window, bidding data on the BSE showed an indicative purchase price of ₹91.10 per share. This bidding activity was higher than the market closing price of ₹92.53 per share on Wednesday. Due to strong demand from large corporate buyers and fund managers, the government decided to increase the total size of the offering.

Due to the strong institutional turnout, the Department of Investment and Public Asset Management (DIPAM) exercised its oversubscription, or greenshoe, option. The base offer was initially for 13,06,85,060 equity shares, representing exactly 1% of the company’s total paid-up equity capital. By exercising the green shoe option, the government added 11,24,02,040 more shares, representing an additional 0.86% stake.

This increased the overall offer size to 24,30,87,100 equity shares, representing 1.86% of the company’s total equity. Of this total increased volume, 10%—i.e., 2,43,08,711 shares—was reserved exclusively for individual retail applicants. In addition, a micro-allotment of 25,000 shares, representing 0.0002% of the total capital, was reserved exclusively for the company’s employees.

Before launching this public share sale, the Government of India held a majority ownership stake of 86.36% in Railway Finance Company. Under current domestic stock exchange regulations, all listed entities must maintain a minimum public shareholding of 25%. This means that the state will have to gradually reduce its total exposure to 75% or less to comply with market regulator directives.

This transaction marks the sixth Central PSU where the administration has reduced its equity stake during the current 2026-27 financial year (FY27). Similar stake sales have previously been conducted in major government firms, including General Insurance Corporation of India (GIC Re), NLC India Limited, NHPC Limited, Coal India Limited, and Central Bank of India. Overall, these strategic divestments have brought a total of ₹16,479.89 crore to the government treasury so far.