Shares of Indian Railway Finance Corp (IRFC) rose over 10% despite the weakness in the market today. At 2:30 pm, the scrip was trading at Rs 44.05, up 10.96% from the previous closing price on the National Stock Exchange (NSE). During the intraday session, the stock touched a fresh all-time high of Rs 44.65.

The stock has also rallied over 27% in the last five sessions. The stock has given multi-bagger returns of more than 105% in the previous year and is up nearly 34% on a year-to-date basis. 

There could be a few reasons for the surge; no single cause can be pinpointed. 

In an exchange filing on Wednesday, the company announced that its board of directors is scheduled to meet on August 11 to consider and approve the unaudited Financial Results and other financial statements for Q1FY23-34. It also added that the Trading Window for insiders, closed since July 1, shall remain closed until August 14, 2023.

Recently, IRFC also inked a Memorandum of Understanding (MoU) with RITES Ltd to identify mutual areas of collaboration for expanding IRFC’s role in providing financial assistance to projects linked with Railways. RITES would assist IRFC in ascertaining the financial & technical viability of projects, providing advisory & consultancy services.

The company plans to create energy, mineral, and cement transport corridors to improve rail connectivity to mining areas, cement plants, and consumption points under the PM Gati Shakti National Master Plan. The railway ministry seeks the Cabinet’s approval for a Rs 5.25 lakh crore investment program during fiscal years 2024-31. 

Another recent reason for the surge could be the buzz around the Indian Railways’ plans to float tenders worth Rs 25,000 crore to procure 60,000 wagons during the July to September quarter of FY23-24. These tenders will benefit companies like RVNL, Ircon International, RailTel, etc. These equipment suppliers and wagon manufacturers will need finance, and that line of credit would be met through IRFC, indirectly leading to a surge in its share price.