Indian Railway Finance Corporation (IRFC) has delivered exceptional third quarter results, achieving its full-year sanctions guidance of ₹60,000 crore within just nine months of the financial year. The state-run railway financing corporation announced these milestone achievements alongside record-breaking quarterly financial performance, posting its highest-ever quarterly profit for the third consecutive quarter.

Record Financial Performance

The company reported its highest-ever quarterly net profit of ₹1,802 crore for the December quarter, representing a robust 11% year-on-year growth. Total income stood at ₹6,719 crore for the quarter, while revenue moderated by 1.5% to ₹6,661 crore from ₹6,763 crore in the corresponding period last year. Net interest margins improved by over 8% year-on-year during the quarter, aided by value-accretive disbursements across diversified segments and disciplined liability management.

Nine-Month Performance and Business Milestones

For the nine months ended December, profit after tax rose to ₹5,325 crore, up from ₹4,820 crore in the same period last year, reflecting a 10% growth. Income for the nine-month period came in at ₹20,009 crore. IRFC's achievement of its full-year sanctions guidance of ₹60,000 crore within nine months demonstrates strong business momentum and operational efficiency.

Strategic Transactions and Funding Initiatives

IRFC refinanced ₹9,821 crore of DFCCIL's World Bank loan, replacing foreign currency exposure with rupee financing. The transaction generated meaningful savings, reduced risk for the railway project, and created a scalable refinancing template for other rail and rail-linked infrastructure assets. During the quarter, IRFC strengthened its funding profile by securing a $300 million external commercial borrowing from Sumitomo Mitsui Banking Corporation, marking its first international commercial borrowing after a multi-year pause.

Revenue Impact and Future Outlook

The marginal decline in revenue was attributed to a one-year extension of a moratorium granted by the Ministry of Railways for a project lease agreement, which impacted revenue recognition during the period. Despite this temporary impact, the company maintained its zero NPA status and achieved record assets under management of ₹4.75 lakh crore, driven by diversification initiatives under IRFC 2.0.

Looking ahead, the company expects higher-margin diversified lending and fresh project agreements with Indian Railways, following the completion of the moratorium period, to support growth from the next financial year. IRFC is exploring opportunities in co-financing, refinancing of rail-linked projects, and selective expansion into areas such as metro rail, renewable energy, logistics, and ports.

Indian Railway Finance Corporation Limited has formally addressed the fines imposed by stock exchanges for non-compliance with board composition requirements, with the company's board deliberating on the matter and seeking resolution through appropriate channels.

Board Meeting Deliberations

The company's board convened on December 18, 2025, to address the non-compliance matter raised by NSE and BSE through their communications dated November 28, 2025. The exchanges had imposed fines on the company for failing to meet board composition requirements and committee constitution norms as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Company's Response Strategy

The board has adopted a multi-pronged approach to address the compliance issue. The directors have decided to follow up with the Ministry of Railways (MoR), the appointing authority, to expedite the appointment of the requisite number of Independent Directors, including women Independent Directors, on IRFC's board.

Simultaneously, the company has requested both NSE and BSE to waive the imposed fines, emphasizing that director appointments are beyond the company's direct control. The board noted that similar fine waivers had been granted by the exchanges in earlier instances of non-compliance for the period from March 2021 to December 2021.

Regulatory Framework Constraints

As a Government company, IRFC operates under specific regulatory constraints regarding board appointments. The power to appoint directors vests with the President of India through the administrative ministry, specifically the Ministry of Railways. This structural arrangement limits the company's direct control over board composition and timing of director appointments.

Previous Precedent

The company has highlighted that stock exchanges have previously shown understanding of similar situations. Both NSE and BSE had waived fines imposed on IRFC for comparable non-compliance issues during March 2021 to December 2021, recognizing the company's limited control over director appointments due to its government enterprise status.

Current Status

IRFC has formally communicated its position to both exchanges through letter No: IRFC/SE/2025-26/77 dated January 13, 2026. The company continues to work with the Ministry of Railways to ensure timely appointment of required directors while awaiting the exchanges' decision on the fine waiver request. The matter remains under active consideration as the company seeks to achieve full compliance with SEBI LODR Regulations.