NEW DELHI: The ministry of railways is planning to dilute 5-10% stakes in six listed railway public sector undertakings and another 2-3% in another listed company through offer-for-sale transactions in FY27, as part of a broader push to meet a ₹2.62 trillion monetization target under the National Monetisation Pipeline (NMP 2.0), two people aware of the matter said.
The seven listed railway PSUs are Indian Railway Catering and Tourism Corp. (IRCTC), Indian Railway Finance Corp. (IRFC), Ircon International, Rail Vikas Nigam Ltd, RITES Ltd, RailTel Corp. of India, and Container Corp. of India (Concor).
The planned sales mark a portfolio-wide monetization strategy across the listed railway ecosystem, while ensuring the government retains management control in all key entities. In Concor, where the government holds 54.80%, the dilution will be limited to 2-3% to keep its stake above 51%, one of the persons said. In the remaining six listed railway PSUs, the government is expected to continue as majority shareholder.
“The partial stake sales in listed railway companies will form a key pillar of the strategy, allowing the government to unlock value while retaining management control,” this person said.
At current market prices, a 5% stake sale across the six PSUs could fetch between ₹15,000 crore and ₹20,000 crore for the exchequer. Realizations could nearly double if a 10% dilution plan is approved, though the final quantum and timing will depend on market conditions and investor appetite, the second person said.
The railways has been assigned a ₹2.62 trillion monetization target under the second phase of NMP, announced in the Union budget for FY26, covering the period 2026–2030.
The stake-sale builds on earlier use of OFS routes. The government sold a 2% stake in IRFC earlier this month, with future transactions expected to be calibrated to valuations and secondary market liquidity, the second person said.
Queries emailed to the ministries of railways and finance as well as the secretary of the Department of Investment and Public Asset Management (DIPAM) remained unanswered till press time. Queries sent to the PSUs mentioned also remained unanswered.
Most railway-linked PSU stocks traded higher on Wednesday afternoon, even as broader market sentiment remained volatile, with shares of IRCTC trading at ₹539 apiece, RVNL at ₹288.15, and IRFC at ₹101.80. Ircon International was at ₹146.84, RITES at ₹214.65, RailTel at ₹324.45, and Concor traded at ₹521.65.
Monetization push
The proposed stake sales come at a time when the Indian Railways is undertaking sustained capital expenditure on dedicated freight corridors, station redevelopment, rolling stock modernization and multimodal logistics integration, alongside flagship train rollouts such as Vande Bharat Express services.
“This is a good development as otherwise railways has not been able to get significant private investment through PPP (public-private partnership). Further, while railway stocks have corrected in the last few months, but even after such corrections, OFS will generate a very large amount for the government,” Kuljit Singh, partner and national infrastructure leader, EY India, said.
Subodh Kumar Jain, former member (engineering), Railway Board, said railway PSUs have strengthened their financial and market performance in recent years, arguing this is a window for faster disinvestment. “This is the right time for the government to disinvest more aggressively and even consider loosening management control.”
He added that proceeds should also be recycled into asset creation and monetization initiatives, including railway land development, station commercialization through PPPs and freight corridor monetization, noting that implementation has lagged despite repeated policy mentions.
Bhavik Vora, partner at Grant Thornton Bharat, described the planned 5-10% stake dilution as a “calibrated and market-aligned” step towards the ₹2.62 trillion monetization target. He said it reflects a shift towards capital recycling through markets while retaining government control, adding that past OFS transactions in IRFC and IRCTC saw supportive investor participation.
However, some experts cautioned that global uncertainties could weigh on valuations.
“PSU disinvestment is a natural process for the government to extract returns on investments made through market capitalization. The government should also reduce its expenditure on operations and maintenance of assets through various brownfield monetization schemes,” said V. Shanker, former executive director–planning, Indian Railways, adding that, “Due to prevailing geopolitical uncertainties and a bearish market environment, this may not be the right time to get maximum returns.”