Earnings call transcript: IRFC posts strong H1 2027 growth, shares rise 2.1%

Indian Railway Finance Corporation (IRFC) reported robust financial results for the first half of fiscal 2027, with revenue up more than 20% year over year and profit after tax (PAT) increasing by more than 10%. Shares of the state-backed lender rose 2.09% to $80.55, or ₹80.55, following the announcement, which exceeded both management guidance and market expectations. IRFC's stock remains below its 52-week high of $137.17 but is trading above its 52-week low of $74.06.

The company's diversified portfolio, which now includes metro systems, ports, renewable energy, thermal power, and road-linked infrastructure, has been the key driver of this performance. IRFC expects FY2027 non-railway disbursements to surpass ₹35,000 crore, up from ₹35,000 crore in FY2026. Its weighted average cost of capital remains at an industry-low 6.55%.

Over the past twelve months, IRFC has maintained profitability and delivered strong returns over the last five years. Its dividend payout ratio is currently about 40% of profits, above the industry norm of around 30%. The company has been profitable for six consecutive quarters, with double-digit PAT growth in five of the last six quarters since diversification began.

Management reaffirmed its target of reaching about ₹5 lakh crore in assets under management by the end of FY2027, a goal that could be achieved as early as the third quarter. IRFC's interim dividend for FY2027 is ₹1.15 per share, up from ₹1.05 per share in FY2026.