Indian Railway Finance Corporation Ltd , a Navratna Central Public Sector Enterprise (CPSE) under the Ministry of Railways (MoR) and registered as a Systemically Important Non-Deposit taking Non-Banking Financial Company (NBFC-ND-SI) and Infrastructure Finance Company (NBFC-IFC) with the Reserve Bank of India (RBI), has published its Business Responsibility & Sustainability Report (BRSR) for FY 2025-26. The report covers the period from April 1, 2025 to March 31, 2026 and has been independently assured by JointValues ESG Services Pvt. Ltd. under the International Standard on Assurance Engagements (ISAE) 3000 (Revised). Established in 1986 as the dedicated market borrowing arm for the Indian Railways, IRFC meets the predominant portion of Extra Budgetary Resources (EBR) requirements of the Indian Railways through market borrowings.

Key Financial and CSR Disclosures

IRFC's CSR is applicable under Section 135 of the Companies Act, 2013. The following table summarises the key financial parameters disclosed in the BRSR:

Business Activities and Strategic Diversification

IRFC's primary business activities include financing the acquisition of rolling stock assets, leasing of railway infrastructure assets and national projects of the Government of India, and lending to other entities under the MoR. The company has initiated a focused diversification strategy (IRFC 2.0) to finance projects with forward and backward linkages for Railways, expanding into sectors such as power generation and transmission, mining, fuel, coal, metro rail, fertilizer, and logistics.

During FY 2025-26, IRFC entered into Memoranda of Understanding (MoUs) with the following entities for strategic collaboration:

• VOCPA – V.O. Chidambaranar Port Authority
• RITES – Rail India Technical and Economic Service
• DMRC – Delhi Metro Rail Corporation
• IIFCL – India Infrastructure Finance Company Limited
• REMCL – Railway Energy Management Company Limited
• MMRDA – Mumbai Metropolitan Region Development Authority
• JNPA – Jawaharlal Nehru Port Authority
• SFCL – Sagarmala Finance Corporation Limited

Environmental Performance (BRSR Core)

The BRSR Core environmental disclosures for FY 2025-26, as independently assured by JointValues ESG Services Pvt. Ltd., are presented below:

Scope 1 emissions arise on account of refrigerant and petrol consumption, while Scope 2 emissions are on account of electricity consumption. Air emissions are reported as negligible given IRFC's nature as an NBFC not involved in any manufacturing activity. During FY 2025-26, IRFC procured 12 Hybrid Cars during January/February 2026 for official use as part of its green mobility initiative, aimed at reducing dependence on conventional fossil fuels and lowering greenhouse gas emissions.

Social and Governance Performance

The BRSR Core social and governance disclosures for FY 2025-26 are summarised below:

IRFC has adopted an Equal Opportunity Policy, a Human Rights Policy, a Whistle Blower Policy, and a Code of Business Conduct & Ethics, all approved by the Board of Directors. The company follows CVC procedures and norms regarding anti-corruption and anti-bribery, and no adverse orders were passed by regulatory authorities during the reporting period.

Inclusive Development and Openness of Business

On inclusive development, IRFC reported that 59.69% of inputs were sourced from MSMEs/small producers, with 100% of procurement sourced from within India. All procurements are conducted through the Government e-Marketplace (GeM) portal. The company reported that 100% of wages were paid to employees located in metropolitan areas, with 0% in rural, semi-urban, or urban locations, consistent with IRFC operating from a single location in New Delhi.

The independent reasonable assurance statement was issued by JointValues ESG Services Pvt. Ltd. on June 27, 2026, covering the nine core attributes of the BRSR Core for the reporting period April 1, 2025 to March 31, 2026 on a standalone basis.

Indian Railway Finance Corporation Limited ( irfc ) reported a record Profit After Tax (PAT) of ₹7,009.17 crore for FY26, marking a 7.80% year-on-year increase from ₹6,502.00 crore in FY25. The Navratna Central Public Sector Enterprise achieved all-time high revenue from operations of ₹27,284.15 crore, up 0.49% from the previous year, driven by its strategic diversification into power, fertilizer, and allied infrastructure sectors beyond its core railway mandate. This financial outperformance underscores IRFC’s successful transition under its “IRFC 2.0” strategy, which aims to broaden its financing footprint while maintaining pristine asset quality with zero Non-Performing Assets (NPAs).

The company’s net worth grew by 7.75% to ₹56,748.76 crore, while Assets Under Management (AUM) reached an unprecedented ₹4.85 lakh crore. Earnings Per Share (EPS) hit a record high of ₹5.36 against ₹4.98 in FY25. The Board of Directors declared a total interim dividend of ₹2.10 per share (₹1.05 each for two interim dividends), amounting to ₹2,744.39 crore in total payout, reflecting a 31% increase over FY25 dividends. Shareholders will convene for the 39th Annual General Meeting on Tuesday, August 25, 2026, via Video Conferencing/Other Audio-Visual Means (VC/OAVM) to adopt these financial statements and approve key board appointments.

Financial Performance and Diversification

IRFC’s growth was fueled by aggressive diversification into non-railway infrastructure segments. During FY26, the company executed financing agreements worth ₹72,949 crore in diversified sectors, significantly exceeding its target of ₹60,000 crore. Disbursements totaled ₹35,067 crore, comprising ₹12,386 crore for railways, ₹9,516 crore for power, and ₹13,165 crore for fertilizers. Notably, no fresh disbursements were made to the Ministry of Railways (MoR) due to a ‘NIL’ target allocation for the year.

The diversification strategy improved spreads and contributed to a rise in the Net Interest Margin (NIM) to 1.50%, up by 6 basis points compared to the previous year. Key transactions included a ₹9,821 crore refinancing facility for Dedicated Freight Corridor Corporation of India Limited (DFCCIL), saving approximately ₹2,700 crore for the entity, and a ₹12,842 crore refinancing deal for Hindustan Urvarak & Rasayan Limited (HURL). The company also sanctioned ₹12,640 crore to CSPGCL and committed close to ₹15,000 crore to MAHAGENCO for power generation projects.

Capital Markets and Borrowings

IRFC mobilized ₹46,263.69 crore through a diversified borrowing mix in FY26, including taxable bonds (₹13,575.42 crore), rupee term loans (₹23,950 crore), 54EC bonds (₹2,306.21 crore), and External Commercial Borrowings (ECBs) of ₹6,432.06 crore. The weighted average cost of funds (WACF) stood at 6.55% per annum. The company prepaid high-cost long-term loans amounting to ₹19,091.78 crore using lower-rate borrowings, optimizing its liability profile.

In capital markets, IRFC made a triumphant return to the ECB market after three years and pioneered its debut in Zero Coupon Bonds, raising ₹2,981 crore in November 2025. The company maintains highest credit ratings domestically (“CARE AAA/Stable”, “CRISIL AAA/Stable”, “ICRA AAA/Stable”) and investment-grade international ratings equivalent to India’s sovereign rating from Standard & Poor’s, Moody’s, and Fitch.

Governance and Board Changes

The AGM will ratify the appointment of Dr. Ranjay Choudhary as Director (Finance) for a five-year term, effective June 30, 2026. Dr. Choudhary brings over 29 years of experience, having previously served as Chief General Manager at Power Finance Corporation Limited. Ms. Laya Madduri, a Government Nominee Director, retires by rotation but is eligible for re-appointment.

The company continues to face regulatory scrutiny regarding board composition; it remains below the minimum six-director threshold and lacks the prescribed number of independent directors required under SEBI LODR Regulations, although fines levied by NSE and BSE for these non-compliances have been waived. The Board has authorized a borrowing limit of ₹70,000 crore for FY27 to support continued growth in railway and allied infrastructure financing.

What the Numbers Show

The divergence between modest revenue growth (0.49%) and stronger profit growth (7.80%) highlights the operational leverage gained from higher-yielding diversified assets. While traditional railway leasing operates on thin, stable margins, the new portfolio in power and fertilizers offers superior spreads, directly boosting profitability without proportional increases in operating costs. The zero-NPA status, maintained despite expansion into new sectors, validates the company’s rigorous credit appraisal framework and the sovereign-backed nature of its core portfolio.