Mumbai: Analysts remain largely cautious on recommending aggressive participation in the government’s two-day offer for sale (OFS) of Indian Railway Finance Corporation Ltd (IRFC), citing the absence of immediate near-term catalysts. The non-retail portion of the OFS was subscribed 94.98% on the first day, with bids received for 22.34 crore shares against 23.52 crore shares on offer. The retail tranche of the two-day share sale will open for bidding on Thursday.

“The stake sale appears largely aligned with the government’s minimum public shareholding requirements rather than signalling any structural shift in the company’s fundamentals,” said Raj Gaikar, research analyst at Samco Securities.

The government on Tuesday announced the sale of up to a 4% stake in Indian Railway Finance Corporation through a two-day OFS. The base offer comprises 26.14 crore equity shares, representing 2% of the paid-up equity capital, with a green shoe option to sell an additional 2%, or 26.14 crore shares.

The floor price has been fixed at Rs 104 per share, reflecting a 4.95% discount to Tuesday’s closing price of Rs 109.40. On Wednesday, shares closed 4.58% lower at ‘104.43.

“The floor price offers limited near-term arbitrage comfort for investors. At Rs 104, the discount is modest, and valuations are no longer deeply discounted,” said Gaikar.

Sebi guidelines mandate that all listed companies, including PSUs, must maintain a minimum public shareholding of 25%, implying promoters cannot hold more than 75% of total equity.

Before the OFS, the government held 86.36% in Indian Railway Finance Corporation. Post the full 4% divestment, its stake will decline to 82.36%. Brokerages said IRFC has benefited from railway capex over the past few years, which has supported steady loan growth and stable margins. With the stock having factored in much of the earnings visibility, incremental upside may hinge on broader market sentiment.