The Government of India has announced an Offer For Sale (OFS) in Indian Railway Finance Corporation (IRFC), triggering fresh discussion among investors. As a result, the stock was under pressure today and ended the day in red at around 104. Is this a buying opportunity or should investors wait? Lets delve into the matter a little.
Key details about IRFC OFS:
Date of announcement: 24 February 2026
Stake Being Sold: 4%
Shares on Offer: 23.13 crore
Floor Price: 104 per share
Total Target Size: 5,430 crore
Day 1: Non-retail investors (Wednesday)
Day 2: Retail investors (Thursday)
The floor price is almost equal to the market price, which makes this a closely watched event.
Why is the Government Selling?
The Government uses OFS as part of its disinvestment strategy in order to raise fund, improve public shareholding or meet regulatory norms. The important thing to note is that this does not impact IRFC’s core business model.
Technical details of IRFC
IRFC is in a short-term downtrend with the current price (104) below 50DMA(118) and 200 DMA(126). At 27, RSI is in the oversold zone which indicates deep short-term weakness. There is a possibility of technical bounce but automatic reversal is doubtful.
Likely Short-Term Impact
OFS increases supply in the market, which can create temporary pressure. In case of IRFC, OFS pricing at market level suggests moderate confidence but no deep discount cushion. If the OFS is fully subscribed, the stock may stabilize above 104 and short covering rally can possibly drive the price towards 110-115. But if 104 break, next support is at 95-98 zone.
When Will Trend Reverse?
Trend will improve when price reclaims 118 and strong reversal will be confirmed above 126. Until then, rallies may face selling pressure.
Is this fundamentally negative?
The simple answer is no. OFS is simply a transfer of ownership from government to public. RFC’s business model remains intact as it is involved in financing Indian Railways projects. It has PSU backing and stable earnings profile.
Long-Term Investors
It is important to note that oversold does not mean bottom but over selling. In order to confirm bottom formation, one has to look for higher low formation, price reclaiming 118 (50 DMA) with higher volumes and RSI moving back above 40–45. In a falling downtrend, it is always better to avoid lump-sum buying. It can rewarding to go for a staggered buying approach with 1st, 2nd and 3rd lot at 100, 90, 80 respectively. It prevents deployment of full capital at once.
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