IRFC share price: Navratna PSU stock dips 20% in YTD. Should you buy before dividend record date?

IRFC share price: Shares of the Navratna company Indian Railway Finance Corporation (IRFC) Limited will be in focus on Monday. The company has declared a board meeting date of 17 March 2025 to consider and approve the proposal for a second interim dividend in the financial year 2024-25.

IRFC dividend 2025 announcement

The dividend stock has already declared a record date on 21 March 2025 for ascertaining eligible shareholders to pay the second interim dividend in FY25. So, 20 March 2025 will be the last date to buy IRFC shares and become eligible for the second interim dividend to be announced on 17 March 2025. For those who believe in discounted shopping, IRFC share price has nosedived more than 20 per cent in YTD due to the stock market crash post-Donald Trump’s inauguration as the 47th President of the United States (US).

IRFC share price outlook

Speaking on IRFC’s share price outlook, Gaurav Goel, Founder and director at Fynocrat Technologies, said, “IRFC share price is currently trading 49% below its 52-week high, showing some weakness. However, IRFC share has delivered steady financial growth, with average revenue growth of 15% and median profit growth of 11%. The ROE stands at 13.7%, reflecting a strong ability to generate returns despite operating in a regulated sector.”

Gaurav Goel said that IRFC share price is available at a P/E ratio of 23.42, slightly above the industry median 20. This indicates that investors are willing to pay a premium for its predictable earnings and government backing. Its zero NPA status, robust asset quality, and high capital adequacy ratio (CRAR) of over 700% further strengthen its financial stability. The company also maintains a self-imposed debt-to-equity limit of 10, currently at 8-9, allowing room for expansion.

Pointing towards the CAPEX expansion of IRFC shares, Gaurav Goel of Fynocrat Technologies said, “One key positive is IRFC’s strategic diversification beyond Indian Railways. It is venturing into higher-margin projects, where returns could be 3x-5x higher, boosting its Net Interest Margin (NIM) and profitability. The ₹6,000 crore cushion in unabsorbed depreciation also ensures no major tax liabilities for the next 4-5 years, supporting better earnings retention.”

Is this a stock to buy?

Advising investors to buy IRFC shares for the long term, Gaurav Goel said, “With a government-backed funding pipeline of ₹4.5 lakh crore and involvement in large-scale projects like Gati Shakti and the India-Middle East-Europe Economic Corridor, IRFC is well-positioned for long-term growth. While the stock may see short-term corrections, its strong financials, steady demand for railway financing, and expansion into new sectors make it a solid long-term bet.”

IRFC share price target 2025

Expecting a rebound in IRFC share price, Sumeet Bagadia, Executive Director at Choice Broking, said, “IRFC share price has crucial support placed at ₹115 apiece. On breaching below this support, the Navratna PSU stock will have strong support at the ₹105 level. IRFC shareholders can hold the scrip, maintaining a stop loss at ₹105 for the short-term target of ₹128 and ₹140. Fresh investors can initiate fresh buying in the scrip for ₹140, maintaining stop loss at ₹115.”

About IRFC

With a revenue of over ₹26,600 crore and a profit after tax exceeding ₹6,400 crore as of March 31, 2024, IRFC is now the third-largest government NBFC in India. It has played a key role in funding nearly 80% of Indian Railways’ rolling stock and was the first CPSE to issue a 30-year tenor bond in overseas markets. As of December 31, 2024, IRFC has a market capitalization of over ₹2,00,000 crore, an asset under management (AUM) of ₹4.61 lakh crore, a net worth of around ₹52,000 crore, and a balance sheet size of more than ₹4.81 lakh crore.

Beyond its core role in railway asset financing, IRFC is expanding into sectors with strong forward and backward linkages to railways, such as power generation and transmission, mining, fuel, coal, warehousing, telecom, and hospitality. The company has already secured funding for 20 BOBR rakes for NTPC, worth ₹700 crore, and was recently declared the lowest bidder to finance a ₹3,190 crore loan for Patratu Vidyut Utpadan Nigam Limited (PVUNL), a subsidiary of NTPC.

Additionally, NTPC Renewable Energy Limited (NTPC REL), a wholly owned subsidiary of NTPC Green Energy Limited (NTPC GEL), has accepted IRFC’s bid for ₹7,500 crore to finance a Rupee Term Loan (RTL) against its Request for Proposal. IRFC is also actively exploring opportunities to fund rolling stock requirements for Indian Railways customers, container train operators, renewable energy needs of Indian Railways, Metro Rail projects, port rail connectivity, and PPP projects sanctioned by Indian Railways.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.