IRFC OFS 2026: Govt stake sale at ₹104 floor

What the government announced on IRFC

The Government of India has moved ahead with a stake sale in Indian Railway Finance Corporation (IRFC) through an Offer for Sale (OFS). The sale is being executed by the President of India acting through the Ministry of Railways, using the stock exchange OFS route. The plan was communicated publicly by DIPAM Secretary Arunish Chawla on X, outlining a two-day window split between institutional and retail participation. The transaction is part of the government’s broader disinvestment programme and also intersects with the minimum public shareholding norms that apply to listed companies.

OFS structure: base offer and green shoe

The OFS was structured in two tranches, with a base offer size and an oversubscription option. The base offer comprised up to 2% of IRFC’s paid-up equity capital. An additional 2% was available under the oversubscription option (green shoe), taking the maximum offered stake to up to 4% if exercised. Multiple disclosures in the context reiterated the base offer near 2% and the overall cap at 4% with the green shoe. Separately, IRFC’s exchange filing also indicated that the total offer size would remain at the base level of about 26.13 crore shares (2% stake), even as the broader OFS framework included the oversubscription option.

Key dates and investor categories

The OFS opened for non-retail investors on February 25, 2026 (T day). The retail and employee portion was available on February 26, 2026 (T+1 day), and the window also allowed carry-forward of non-retail bids where applicable. The offer ran during normal market hours on both BSE and NSE. The two-day format is typical for OFS transactions, separating institutional bidding from retail participation.

Pricing: ₹104 floor price and no retail discount

The floor price for the IRFC OFS was set at ₹104 per share for all categories of investors. Disclosures indicated that no separate retail or employee discount was announced, meaning the same floor or cut-off price applied across investor classes. The floor price was positioned as a discount to the prior market close. The context cited a discount of about 4.95% to Tuesday’s closing price of ₹109.40.

What happened to the IRFC stock price

After the stake sale announcement, IRFC shares saw pressure and were reported to have fallen over 4% to a fresh 52-week low. The context also noted that on Wednesday, the shares closed 4.58% lower at ₹104.43. With the floor price at ₹104 and the stock trading near that level, the pricing left limited gap for investors looking for near-term price arbitrage versus the secondary market.

Size of the offer and share counts

The base offer was described as about 26.13 crore to 26.14 crore shares, representing 2% of the paid-up equity capital. If the green shoe was fully exercised, an additional 2% (another roughly 26.13 crore to 26.14 crore shares) could be sold, taking the total to about 52.27 crore shares. The paid-up equity capital was stated as 13,06,85,06,000 equity shares of face value ₹10 each. These figures set the mechanical limits for the OFS supply that could come into the market.

Outcome: 1.71% stake sold over two days

In a subsequent disclosure, it was reported that the President of India, acting through the Ministry of Railways, sold a 1.71% stake in IRFC through the OFS conducted on February 25 and 26, 2026. The total shares sold were stated as 22,40,40,829 equity shares, executed via the stock exchange mechanism on BSE and NSE under applicable regulatory guidelines. This indicates the final sale (1.71%) was below the maximum headline availability (up to 4% with oversubscription), based on the reported execution outcome.

Why this matters: public shareholding and government ownership

Before the OFS, the government holding in IRFC was cited at 86.36%. Sebi’s minimum public shareholding framework requires listed companies, including PSUs, to maintain at least 25% public float, implying promoter holdings should not exceed 75%. A research comment in the context framed the OFS as largely aligned with minimum public shareholding requirements rather than a change in company fundamentals. With promoter ownership significantly above 75%, periodic stake sales can be a route to improve float over time.

What investors should watch from the disclosures

The OFS details were specific on price, dates, and execution venue, which are key variables for market participation. The floor price of ₹104 per share acted as the lower bound for bidding, and the lack of a retail discount narrowed the pricing advantage for smaller investors. The post-announcement price move, including the close near ₹104.43, showed the market quickly adjusted to the supply overhang and the pricing band. Investors also tracked the final outcome, where the reported sale settled at 1.71% stake, alongside the disclosed paid-up capital figures.

Key facts table

Market impact and analysis

The immediate market impact was visible in the price reaction, with IRFC falling over 4% and trading close to the OFS floor price. That move reflected the added supply expected from a large shareholder sale and the modest discount embedded in the floor price versus the market. The OFS also highlighted the constraints PSUs face under minimum public shareholding rules, especially when promoter holdings remain well above the 75% threshold. From a participation standpoint, the absence of a retail discount and the floor set close to prevailing prices reduced the scope for short-term pricing advantage.

Conclusion

The IRFC OFS in February 2026 set a ₹104 floor price and followed a two-day structure split between non-retail and retail investors on BSE and NSE. While the government had indicated the ability to sell up to 4% with a green shoe option, the reported execution outcome showed a 1.71% stake sale over the two days. The next milestones for investors are any further disclosures on promoter stake levels and additional disinvestment steps, if announced.