Most retail-focused brokerages are advising their clients to subscribe to the IPO with a long-term view.
“IRFC has posted strong growth in operating income of 20.7 per cent CAGR between FY18-20 while net profits have grown at a CAGR of 26.3 per cent during the same period. Company is unlikely to face any asset quality issues given the fact that the company caters to the government of India. At the higher end of the price band the stock would be trading at P/BV of 1 times fully diluted post issue book value of Rs 26.6 per share. We expect the company to post strong growth driven by capex by Indian railways along with stable margins due to cost plus model. Given the growth prospects, we recommend a SUBSCRIBE rating on the issue,” said Angel Broking in a note.
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