Indian Railway Finance Corporation reported its highest-ever half-year net profit for the first half of FY27, clocking ₹3,885.69 crore, a 10.31% increase from the corresponding period last year. The Board of Directors also declared a record-high interim dividend of ₹1.15 per share.

The government-owned financier saw its total income rise to ₹16,315.80 crore in H1FY27, compared to ₹13,290.15 crore in H1FY26, reflecting a 22.77% growth. For the second quarter alone, profit after tax stood at ₹1,958.48 crore, up 10.21% from ₹1,776.98 crore in Q2FY26. The company maintained a clean loan book with zero non-performing assets (NPA) during the quarter.

Growth outlook and disbursement targets

The company confirmed expectations of double-digit growth in both profit after tax (PAT) and revenue by FY27. IRFC stated that it aims to disburse more than ₹35,000 crore soon, signaling continued aggressive expansion in its lending portfolio to support railway infrastructure development.

Financial performance overview

The Corporation’s financial metrics indicate sustained profitability and a strengthening balance sheet. Net worth reached a record ₹60,573.35 crore as on September 30, 2026, up from ₹56,748.76 crore as on March 31, 2026. The debt-equity ratio improved to 7.12 times from 7.25 times a year ago.

Dividend declaration and record date

The Board approved an interim dividend of ₹1.15 per equity share of face value ₹10 each for FY27. This marks the highest dividend payable in a single tranche by the company. The record date for determining eligibility is October 23, 2026. Shareholders holding shares in demat form must ensure their bank details are updated with their depository participants to receive the payout electronically, as physical dividend warrants have been discontinued.

What the numbers show

A divergence between revenue growth and profit growth highlights margin compression despite top-line expansion. While total income grew 22.77% YoY, net profit increased only 10.31%. Finance costs rose significantly to ₹12,338.12 crore in H1FY27 from ₹9,668.81 crore in H1FY26, absorbing a large portion of the incremental revenue. Additionally, the net interest margin (NIM) for the quarter stood at 1.50% annualized, indicating that while the asset base is expanding, the spread remains tight relative to the cost of funds.

The company also noted that the moratorium period for certain lease agreements with the Ministry of Railways completed in March 2026, which likely contributed to the sharp jump in lease income recognized in the current period compared to the previous year.

Indian Railway Finance Corporation Limited received a Show Cause Notice (SCN) worth ₹396.91 crore from the Joint Commissioner of State Tax, Hajipur Circle, on September 29, 2026. The notice pertains to the financial year April 2022 to March 2023.

The SCN was issued under Section 73 of the BGST/CGST Act, 2017. The total amount indicated includes applicable interest and penalty. The company stated that the issues raised are generic in nature.

Regulatory Disclosure Details

The disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The notice was received via email communication. The specific authority involved is the Office of the Joint Commissioner of State Tax, Hajipur Circle, Hajipur.

Company Response Strategy

IRFC is currently evaluating the SCN. Based on advice from its tax advisors, the company intends to file a detailed reply with the adjudicating authority within the prescribed timelines. It further stated that it will pursue all legal remedies available to it.

Financial Implications

The company noted that as the case is at the show cause notice stage only and no order has yet been issued, expected financial implications cannot be quantified at this stage. The penalty can only be quantified after the issuance of an order by the authority.

What the Numbers Show

The disclosed amount of ₹396.91 crore represents a significant contingent liability relative to typical operational costs, though it remains unquantified as a final impact due to the procedural stage. The inclusion of interest and penalty in the initial claim suggests the authorities are treating the alleged non-compliance as substantive rather than minor, necessitating a robust legal response from the company.