The Railway PSU company, Indian Railway Finance Corp Ltd, has approved a loan of ₹12,640 crore to Chhattisgarh State Power Generation Company Limited. The company’s share price has fallen 22% in the past year. IRFC, a Government of India company, has approved a loan of ₹12,640 crore to Chhattisgarh State Power Generation Company Limited (CSPGCL). This loan is for CSPGCL’s upcoming 2 x 660 MW supercritical thermal power project at HTPS, Korba West. CSPGCL is a wholly owned unit of the Chhattisgarh government and is the state’s leading electric generation unit, with an installed capacity of over 2,600 MW.
Navratna Company Finances Several Projects
IRFC serves as the financial arm of the Ministry of Railways and has financed several projects. IRFC recently received ‘Navratna’ status. The company is now expanding beyond traditional rail infrastructure financing to invest in a wide range of infrastructure projects, including those related to the railway ecosystem, such as power generation, mining, ports, and multimodal logistics. Indian Railway Finance Corp Ltd.’s share price fell 1.50% on Friday to close at ₹122.20. This railway PSU stock has fallen 22% in the past year. This decline occurred in the year’s first half, while the stock’s returns in the second half were flat.
The company has a market capitalisation of ₹1.59 lakh crore. The stock is up 12% from its 52-week low of ₹108.05 per share and has delivered a multi-bagger return of 479% over three years.
Debt of the Company
Indian Railway Finance Corp. Ltd.’s profile is such that it finances railway and power projects. The company also has debt, with a debt-to-equity ratio of 7.44, which is very high. However, the company is lending, so loan interest rates vary.
The company’s earnings remain stable, and its return on equity is 12.8%. The stock’s price-to-earnings ratio is 23.9, comparable to the industry average.
