Indian Railway Finance Corporation Ltd Directors Report

Dear Shareholder(s),

Your directors have the pleasure in presenting the 39th Annual Report of the Company along with the Audited Financial Statements, Auditors Report and review of the Accounts by the Comptroller & Auditor General of India for the financial year ended 31st March 2026.

1. Financial Highlights

Particulars	Year ended 31-03-2026	Year ended 31-03-2025
I. Revenue from operations	27,284.15	27,152.14
II. Dividend Income	0.54	0.72
III. Other income	53.37	3.55
IV. Total Revenue (I+II+III)	27,338.06	27,156.41
V. Expenses
Finance costs	20,005.26	20,495.09
Impairment on financial instruments	124.03	0.68
Employee benefit expense	21.28	13.51
Depreciation and amortization expense	6.05	5.31
Other expenses	172.27	139.82
Total Expenses	20,328.89	20,654.41
VI. Profit before tax (IV-V)	7,009.17	6,502.00
VII. Tax expense:
(1) Current tax	-	-
(2) Adjustment for Earlier Years	-	-
(3) Deferred tax	-	-
Total Taxes	-	-
VIII. Profit (Loss) for the current Year from continuing operations (VI-VII)	7,009.17	6,502.00
IX. Other Comprehensive Income	(184.71)	(15.67)

Revenue from operations of your Company has increased by 132.01 Crore from 27,152.14 Crore in 2024-25 to 27,284.15 Crore in 2025-26, showing a growth of 0.49 %.

Profit before Tax (PBT) of your Company for the year ended 31st March 2026 was 7,009.17 Crore as compared to 6,502.00 Crore for the previous year, registering a growth of

7.80%. Company had elected to exercise the option permitted under section 115 BAA of the Indian Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment) ordinance, 2019 dated 20th September 2019. Pursuant to exercise of such option of Section 115 BAA, the taxable income under normal assessment is NIL. Further, after adoption of Section 115 BAA, the Company is outside the scope and applicability of Minimum Alternate Tax (MAT) provision under section 115 JB of Income Tax Act. Accordingly, no provision has been made in the accounts for the FY 2021-22, FY 2022-23, FY 2023-24, FY 2024-25 and FY 2025-26 as well. Profit After Tax for the year ending 31st March 2026 was 7,009.17 Crore as compared to 6,502.00 Crore for the previous year, registering a growth of 7.80%.

Earnings Per Share (EPS) for the financial year ended March 31, 2026, was 5.36 per share of face value of 10/- each, as against EPS of 4.98 per share in the previous financial year.

Net worth of the Company as on March 31, 2026 stands at 56,748.76 Crore. Asset under management (AUM) stood at 4,84,616.77 at the end of financial year 2025-26.

2. Dividend

Your Company endeavours to maintain an optimal balance between the return to the shareholders and retaining a reasonable portion of the profit to maintain a healthy financial leverage with a view to supporting and sustaining future borrowings and growth.

During FY 2025–26, the Board has declared the following interim dividends:

First Interim Dividend of 10.5% (i.e., 1.05 per equity share having face value of 10/- each for FY 2025 26) at the Board Meeting held on 15th October 2025, which was paid on 6th November 2025.

Second Interim Dividend of 10.5% (i.e., 1.05 per equity share having face value of 10/- each for FY 2025 26) at the Board Meeting held on 9th March 2026, which was paid on 24th March 2026.

Accordingly, the total interim dividend for the financial year 2025 26 amounts to 2.10 per equity share of 10/- each. The total dividend paid during the FY 2025-26 amounts to 2,744.39Crore (1st Interim Dividend and 2nd Interim Dividend FY 25-26).

As per regulation 43A of the SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015 (the "Listing

Regulations"), the top 1000 listed companies shall formulate a Dividend Distribution Policy.

The company has duly adopted the policy to set out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and/or retained profits earned by the Company.

The policy is also available on the Companys website at https://irfc.co.in/sites/default/files/inline-files/DIVIDEND%20 DISTRIBUTION%20POLICY_2.pdf

The details of unpaid/unclaimed amount of dividend as on 31st March 2026 is as follows:

Financial Year	Bank Name	Type of Dividend	Amount (J in Crore)
2020-21	HDFC	Interim	0.579
2021-22	IDBI	Interim	0.375
2021-22	INDUSIND	Final	0.276
2022-23	IDBI	Interim	0.305
2022-23	INDUSIND	Final	0.258
2023-24	INDUSIND	Interim	0.279
2023-24	RBL	Final	0.224
2024-25	IDBI	Interim	0.227
2024-25	INDUSIND	2nd Interim	0.208
2025-26	IDBI	Interim	0.281
2025-26	RBL	2nd Interim	9.54

Further, Members are requested to note that, dividends if not encashed for a consecutive period of seven (7) years from the date of transfer to Unpaid/Unclaimed Dividend Account of the

Company, are liable to be transferred to the Investor Education and Protection Fund ("IEPF") authority in accordance with the applicable provisions of the Companies Act, 2013. The shares in respect of such unpaid/unclaimed dividends are also liable to be transferred to the demat account of the IEPF Authority. In view of this, Members are requested to claim their dividends from the Company, within the stipulated timeline.

Details of Unpaid/Unclaimed Dividends are also available on Companys website at https://irfc.co.in/investors/ financial-information.

3. Reserves

As per Section 45 - IC of the RBI Act, 1934, all NBFCs are required to create a Reserve equivalent to 20% of the net profit before declaration of dividend.

Accordingly, 20% of the net profit of the Company amounting to 1,401.83 Crore had been transferred to Reserve Fund u/s Section 45 - IC of RBI Act, 1934 during the FY 2025-26.

4. Share Capital

As on 31st March 2026, the Authorized Share Capital of the Company was 25,000 Crore, consisting of 25,000,000,000 Equity Shares of 10/- each. The issued and paid-up share capital of the Company was 13,068.506 Crore, consisting of 13,068,506,000 Equity Shares of 10/- each.

During FY 2025–26, the Government of India, through the President of India acting via the Ministry of Railways, undertook disinvestment of 1.71% of its equity shareholding in the

Company through Offer for Sale (OFS), in compliance with the guidelines issued by the Department of Investment and Public Asset Management (DIPAM), SEBI regulations and other applicable laws and regulation.

Pursuant to completion of the said Offer for Sale, the shareholdingoftheGovernmentofIndiawasreducedto84.65%.

The OFS formed part of the Governments disinvestment initiative aimed at achieving compliance with minimum public shareholding norms and strengthening public participation and market liquidity in the Company.

As on 31st March 2026, 84.65% of the paid-up equity share capital of the Company comprising of 11,06,23,96,171 Equity Shares of 10/- each was held by President of India acting through administrative ministry i.e., Ministry of Railways (MoR). The balance 15.35% of paid-up equity share capital was held by public shareholders. During the period under review, there was no change in authorized and paid-up share capital of the Company.

Based on market capitalization, the Company ranked among the top 100 listed companies on both the National Stock Exchange (NSE) and the BSE Limited (BSE) as on 31st March 2026.

5. Policy Review

The Company remains committed to upholding a strong internal policy framework aligned with its commitment to good governance, ethical conduct, and regulatory compliance.

During the year under review the Company undertook a comprehensive review of its policies to ensures their adequacy, effectiveness and alignment with the regulatory amendments under the Companies Act, 2013, SEBI (LODR) Regulations, 2015, other applicable laws, regulatory provisions and evolving business requirements. Further, the Company has updated various policies, including, among others- the Stakeholder Engagement Policy, Policy on Responsible Advocacy with Public and Regulatory Bodies, Equal Opportunity Policy,Human Rights Policy, and the Integrated Stakeholder Grievance Redressal Document.

6. Independent Evaluators Assessment

6.1 Credit Ratings

6.1.1Domestic:

During the financial year 2025-26, the Companys long-term domestic borrowing programme was awarded the highest credit rating of "CARE AAA/Stable", "CRISIL AAA/ Stable" and "ICRA AAA/Stable.

‘‘The Company also got its short-term borrowing programme rated, obtaining the highest rating of "CARE A1+", ‘‘CRISIL A1+ and ‘‘ICRA A1+.

6.1.2 International:

During the financial year 2025-26, three international credit rating agencies - Standard & Poors, Moodys and Fitch - have awarded "BBB with Stable Outlook", "Baa3 with Stable Outlook" and "BBB- with Stable Outlook" ratings respectively to your Company. Besides, the Company obtained an issuer specific credit rating of "BBB+ with Stable Outlook" from the

Japanese Credit Rating Agency. Each of the four credit ratings is equivalent to Indias sovereign rating and is of investment grade.

6.2. Memorandum of Understanding (MoU)

The Company enters into an annual Memorandum of Understanding (MoU) with the Ministry of Railways (MoR),Government of India, in accordance with the guidelines issued by the Department of Public Enterprises (DPE). The

MoU stipulates financial, operational and compliance-related performance parameters against which the Companys performance is evaluated annually.

The MoU for FY 2024-25 was executed with the Ministry of

Railways on 14th September 2023. Based on its performance against the agreed targets, the Company has been accorded the rating of "Excellent" by the Department of Public Enterprises (DPE) for FY 2024-25.

Under the leasing framework for Project Assets, an initial moratorium period of five years is provided during which lease rentals are not payable by the Ministry of Railways. In accordance with the applicable financing arrangement, finance cost recognized during the moratorium period is treated as annual disbursement and added to the Assets Under Management (AUM) of the Company.

During FY 2025-26, the Company recognized disbursements of H 15,260.24 crore to the Ministry of Railways and H 35,067.68 crore to other entities, totalling to H 50,327.92 crore. Total Funds available for loan disbursement in the year was H 50,539.23 crore. Balances related to loans outstanding as on 31.03.2026 are as follows:

Particulars	Amount (in Crore )
Current Borrowing as on 31.03.2026	31,285.45
Non-Current Borrowing as on 31.03.2026	4,05,184.94
Loans disbursed during the year	50,327.92
Total Loan as on 31.03.2026	4,84,616.77
Total funds available for loan disbursement in the year	50,539.22
Overdue Loans as on 31.03.2026	NIL
Non-performing Assets as on 31.03.2026	NIL

Balances on Based on self-evaluation, Companys performance against the key MoU parameters is summarized below:

Performance Criteria	Achievement
1 Loans Disbursed to Total Funds Available (%)	99.58
2 Overdue Loans to Total Loans (%)	0.00
3 NPA to Total Loans (%)	0.00
4 Cost of Raising Funds through Bonds as compared to similarly rated CPSEs (bps)	(-)23
5 Procurement through GeM (as percentage of Total procurement) (%) Total Procurement: H 8.31 crore Procurement from GeM: H 8.16 Crore	98.19%

In addition to the above performance parameters, the Company complied with all the additional compliance parameter prescribed under the MoU framework for FY 2025-26, as summarised below.:

Compliance Parameter	Status
1 Compliance with DPE guidelines on CSR expenditure	Complied
2 Compliance with Corporate Governance requirements under the Companies Act, 2013 and SEBI (LODR) Regulations, 2015	Complied*

3 Compliance with onboarding of CPSE on all operational TReDS platforms

Name of Platform	Date of Registration
Receivables Exchange of India Limited (RXIL)	04-09-2019
C2FO Factoring Solutions Pvt Ltd (C2treds)	30-12-2024
Invoicemart (A.TREDS LTD.)	09-01-2025
Mynd Solutions Pvt Ltd (M1xchange)	15-01-2025
KredX Platform Private Limited (DTX)	17-11-2025

4 Compliance with Timely payments to MSE vendors as prescribed in MSMED Act

Complied
Particulars	Amount
Payments made within 45 days	7.94
Payments pending beyond 45 days	0
Total Amount involved in delays	0
Number of Invoices involved in delays	0
Number of Suppliers involved in delays	0
Total Annual Procurement Value	8.31
Total Number of MSE invoices during the year	300
Total Number of MSE suppliers during the year	60

 

5 Compliance with Procurement of goods and services (as % of total procurement), from:	Complied
	Procurement of goods and services from:
a. MSEs overall-25%	a. MSEs overall – H 4.96 Crores (i.e.59.69%)
b. SC/ST owned MSEs-4%	b. SC/ST owned MSEs- H 0.96 Crores (i.e.11.55%)
c. Women Owned MSEs-3%	c. Women Owned MSEs- H 0.56 Crores (i.e.6.74%) Complied
6 Compliance with Steps and initiative taken for Health & Safety improvement of Human Resources in CPSEs	The Health camps were organized at IRFC on 28th July 2025 on World Hepatitis Day, 29th October 2025 on World Stroke Day, 14th November 2025 on World Diabetes Day, 12th December 2025 on Universal Health Coverage Day, 4th February 2026 on World Cancer Day and on 24th March 2026 on World Tuberculosis Day.

*To the extent compliance are within the ambit of company.

7. Market Borrowings during 2025-26

The Board of Directors had approved borrowing limit of 60,000 Crore for FY 2025-26 for meeting the funding requirement of Indian

Railways, if any, new business activities, refinancing of existing loans and for other general corporate purposes.

During FY 2025 26, the Company continued to maintain a diversified and prudent borrowing profile to support its financing requirements and optimize cost of funds. As per financial statements, during the year Company mobilised resources amounting to 46,263.69 Crore through multiple funding instruments, which includes Taxable Bonds aggregating to 13,575.42 crore (Previous year: 27,240 Crore), Rupee Term Loans amounting to 23,950 crore (Previous year: 3,500 Crore), 54EC Bonds of 2,306.21crore (Previous year: 1,877.30 Crore), and External Commercial Borrowings (ECB) of 6,432.06 crore. The diversified borrowing mix enabled the Company to maintain financial flexibility, competitive cost of borrowing and efficient asset-liability management.

The weighted average cost of funds (WACF) for the financial year 2025-26 worked out to 6.55% p.a.

The company had also prepaid high cost long term loan of 19,091.78 Crore from lower rate borrowings.

8. Disbursements

Company is taking several strategic steps to diversify its lending portfolio. During the FY 2025-26, company started funding for projects other than MoR under its mandate of financing for activities having forward and backward linkages with railways.

Disbursement to MoR: During the FY 2025-26, no fresh disbursement was made to MoR due to ‘NIL target allocation for the year.

Disbursement to Other than MoR: During FY 2025–26, the

Company executed agreements worth 72,949 crore, marking a significant scale-up in its diversified infrastructure financing business. The sanctions comprised 12,493 crore towards railways, 43,614 crore towards Power and 16,842 towards fertilizers. Total Disbursements during FY 2025-26 stood at 35,067 crore, including 12,386 towards railways, 9,516 crore towards Power and 13,165 towards fertilizers. Through participation in competitive RfP-based financing processes across multiple infrastructure sectors, IRFC has established itself as a credible source of long-term infrastructure finance, contributing to greater competition and pricing efficiency in the infrastructure financing market traditionally dominated by banks and select financial institutions.

The diversification-led expansion resulted in improved spreads and a consistent rise in net interest margin (NIM), while IRFC maintained its pristine zero NPA status.

9. Redemption of Bonds / Repayment of Loans

As per financial statements, during the year Company redeemed the Domestic Bonds of 4,569.73 Crore, 54EC Bonds of 842.50 Crore and External Commercial Borrowings (ECB) of 1,575.06 Crore. The Company also prepaid long term loans of 19,091.78 Crore during the year. The Company continues to maintain its impeccable track record of servicing its debt in time.

10. Internal Control Systems & their adequacy

The details are given in Management Discussion and Analysis.

11. RBI Prudential Norms

Your Company is registered as a Systemically Important Non-Deposit Taking Non- Banking Finance Company with the Reserve Bank of India. Being a Government NBFC, your Company was exempted from the prudential norms prescribed by Reserve Bank of India for NBFC-ND-SI, as contained in the Master Directions issued vide Notification No. DNBR.008/ CGM(CDS)-2015, dated 27th March, 2015. The exemption was withdrawn by Reserve Bank of India from 31st May, 2018. However, the Company has obtained exemption from Reserve Bank of India from the asset classification, income recognition, credit concentration and provisioning norms on the direct exposure to Ministry of Railways, Govt. of India vide RBI letter dated 21st December, 2018. The Company has also obtained relaxation in respect of lending limit applicable to Railway CPSEs from 20% of its owned funds to 100% of its owned funds. As such, the Company has complied with the applicable prudential norms.

Liquidity Coverage Ratio (LCR) Exemption:

The company has got an exemption from RBI from applicability of Liquidity Coverage Ratio (LCR) norms.

Applicability of approvals/acknowledgements previously given by RBI post issue of RBI Scale Based Master Directions.

RBI has issued new Master Direction -Reserve Bank of India (Non-Banking Financial Company -Scale Based Regulation) Directions, 2023 on 19.10.2023 (referred as RBI Master Directions dated 19.10.2023 as amended).

RBI has clarified all approvals/acknowledgements given under Circulars/Directions mentioned in the repealed list as provided in section XI of ‘the new Directions shall be deemed as given under ‘the new Directions. Notwithstanding such repeal, any action taken/purported to have been taken or initiated under the instructions/guidelines having repealed shall continue to be guided by the provisions of said instructions/guidelines.

12. Lease Arrangement with the Ministry of Railways

As you are aware, the financial relationship of the Company with the Ministry of Railways is based on a Financial Lease arrangement which is regulated by a standard lease agreement. During the FY 2025-26, no fresh disbursement has been made to MoR.

Further, IRFC commenced project funding to MoR (Ministry of Railways) for creation & development of railway infrastructure projects in October 2015 under finance lease model with commencement of lease rentals after a gestation period of 5 years. As at 31st March 2025, the execution of Lease Agreement for EBR IF 2019-20 was in process. However, during FY 2025-26 based on the mutual discussion between IRFC and MoR, the gestation period of 5 years was increased by another 1 year for EBR IF 2019-20 as the assets to be leased under the agreement were still in final stage of development. Accordingly, the execution of Lease Agreement for EBR IF 2019-20, EBR_IF 2020-21 & EBR_S 2020-21 is under process. The lease agreements for funding for EBR_IF from FY 2021-22 to FY 2022-23 shall be executed on completion of moratorium period.

13. Resource Mobilization for 2026-27

Board has authorized the Company to borrow funds amounting to 70,000 Crore as may be required during FY 2026-27 for meeting the funding requirement of Indian Railways, if any, disbursement for diversification under IRFC 2.0, committed liabilities, refinancing of existing loans and for other general corporate purposes.

14. Management Discussion and Analysis and Companys Outlook for the future

Management Discussion and Analysis, forming part of the Directors Report given at ANNEXURE- I.

15. Report on Corporate Governance

The Government considers good corporate governance practices a sine qua non for sustainable business that aims at generating long term value for its shareholders and all other stakeholders. Accordingly, it has been laying increasing emphasis upon development of best corporate governance practices amongst Central Public Sector Enterprises (CPSEs). In pursuance of this philosophy, your Company continues to comply with the ‘Guidelines on Corporate Governance for Central Public Sector Enterprises issued by Government of India, Department of Public Enterprises (DPE). Your Companys

Equity as well as Non-Convertible Debt Securities are listed on the stock exchanges and Company has complied with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable regulations, to the extent applicable.

As on 31st March 2026, there were 5 (five) Directors on the Board of the Company. The Board comprises of a Chairman & Managing Director and CEO, Director (Finance), 2 (Two) Government Nominee Director(s) and 1 (One) Non- Official Independent Director. The Company does not have the prescribed number of Independent Directors (including independent woman director) on its Board in compliance of the Regulation 17(1) (a) & 17(1)(b) of SEBI (LODR) Regulations, 2015, specifying the composition of Board of Directors. Also, the Board strength remained below the minimum of six (6) directors as specified under Regulation 17(1) (c) of SEBI (LODR) Regulation, 2015. Being CPSE, the power to appoint Directors vests with Government of India (GoI) through Ministry of Railways (MoR) and Company has no role to play in it. The Company has already requested MoR for appointment of requisite number of Independent Directors (including independent woman Director).

As on date of this report there are 4 (four) Directors on the Board of the Company. The Board comprises of a Chairman & Managing Director and CEO, Director (Finance) and Two Government Nominee Director(s).

Report on Corporate Governance is enclosed as ANNEXURE- II forming part of this report.

16. Business Responsibility & Sustainability Report (BRSR)

The Business Responsibility & Sustainability Report, as stipulated under Regulation 34 (2) of the SEBI (Listing

Obligations and Disclosure Requirements) Regulations, 2015, is given in ANNEXURE-III and forms part of this Report.

17. Corporate Social Responsibility

Activities relating to Corporate Social Responsibility (CSR) have become an integral part of Companys operations.

In terms of Section 135 of the Companies Act, 2013 (the Act), read with Schedule VII thereof and Companies (Corporate Social responsibility Policy) Rules, 2014, the Company has constituted a CSR Committee (the "Committee") comprising of Chairman & Managing Director, Director (Finance) and Non- Official Independent Director as on 31st March 2026. As per the

Act, Company is required to spend at least two (2) percent of the average of its net profits of the immediately three preceding financial years on CSR activities. The Department of Public Enterprises (DPE) has also issued guidelines in this regard which, inter alia, require the Central Public Sector Enterprises (CPSEs) to frame a ‘CSR and Sustainability Policy.

The ‘CSR and Sustainability Policy of the Company is in place and the same has also been hosted on the website at https:// irfc.co.in/sites/default/files/inline-files/CSR%20Policy_0. pdf. The Company, like in the past, has undertaken activities for CSR and Sustainable Development, details of which, are given hereunder:

During the financial year 2025-26, the Company was required to spend 128.33 Crore, being 2% of its average net profits for the last three financial years. The Company has approved a total of 20 projects. Gross amount required to be spent for the year ended 31st March 2026 amounting to 128.33 crores against which the Board has approved total CSR projects worth amounting to 125.69 crores. Out of them, 8.40 crores were spent in the same financial year, amount spent in Administrative

Overheads of 2.54 crore, amount spent on impact assessment of 0.10 crore, amount of 8.58 Crore was transferred to IRFC

Foundation Account before 31st March 2026, a payment of 0.90 crores were disbursed to an implementing agency during the month of April 2026 and correspondingly 110.45 Cr was transferred to Unspent CSR Account FY 2025-26 and the same would be disbursed on receipt of bills/ claims from the implementing agencies. During the FY 2025-26, Company has sanctioned an additional amount of 2.65 crore which will be carryforwardedandsetoffagainsttheCSRbudgetforFY2026-27 as per CSR Rules. The details of CSR activities as required under the Companies Act for the financial year 2025-26 is annexed at ANNEXURE - IV.

CSR Activities proposed for the FY 2026-27

For the financial year 2026-27, the Company would be required to spend approx. H 132.81 Crore. The details of all the projects/ activities will be provided in the next Annual Report.

18. Directors Responsibility Statement

As required under Section 134(3)(c) of the Companies Act,

2013, it is confirmed that:

a) In the preparation of the annual accounts for the year ended 31st March 2026, the applicable Indian Accounting Standards have been followed and there are no material departures; b) such accounting policies have been re-drafted taking into account the Ind-AS, judgments and estimates made are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period;

c) Proper and sufficient care has been taken for maintenance of adequate accounting records, in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud or other irregularities;

d) the Annual accounts have been prepared on ‘going concern basis;

e) Had laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; and

f) Proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

19. Human Resource Management

At IRFC we believe in a strong value system and best HR practices to enhance and improve our capabilities and achieve the organizational objectives.

As of 31st March 2026, the total manpower of the Company stood at 59. To strengthen the existing workforce, the Company inducted 10(ten) Executives and 06 (six) Executives on deputation during the financial year 2025–26. Women comprised approx. 17% of the total workforce as on 31st March 2026.

The Company continues to maintain high level of employee productivity and efficiency as reflected in its low overhead to turnover ratio of less than 0.19%.

19.1 Women Employees

Your Company provides equal growth opportunities for the women in line with Govt. of India philosophy on the subject. Being a lean organization, where Company has employees, women representation has grown across hierarchical levels. Thus, Women constituted approx. 17% of its total workforce as on 31st March 2026. As per Govt. of India directives and guidelines from time-to-time, IRFC ensures the welfare of women employees.

19.2 Information under Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013

The Company has an Internal Complaints Committee (ICC) to examine the case related to Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. No complaints were received during the year under review under the provisions of the said Act.

Details of complaints in relation to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 for the year under review is as follows: -

Particulars	No. of Complaints
1 Number of Complaints filed during FY 2025-26	Nil
2 Number of Complaints disposed of during FY 2025-26	Nil
3 Number of Complaints pending as on end of the FY 2025-26	Nil

19.3 Training & Human Resource Development

In order to enhance the skills, capabilities and knowledge of employees, a well-defined Training and Development Policy for below board level executives and non-executives is in place. Employee training and development is an essential element of the Companys strategy. During the year 2025-26, the Company imparted training to 57 of its employees through various training programmes and workshops including inhouse trainings.

19.4 Employee Welfare

The Company takes care of health and well-being of its employees by reimbursing in-patient and out-patient medical costs, provision for leaves on medical grounds, rehabilitation policy in case of death or permanent disability, which are applicable for all employees.

19.5 Your Company complies with the provisions relating to Maternity Benefit Act, 1961.

19.6 Sports activities

The Company recognises that employee engagement in sporting activities plays a vital role in fostering harmony, inclusiveness, and team spirit within the organisation. As part of its employee well-being initiatives, the Company continues to integrate sports and recreational activities into its workplace culture to support holistic employee development and create a more vibrant organisational environment. During the year, IRFC organized its Annual Sports Day 2025-26 on February 20, 2026, wherein the employees of the Company across various departments have participated in various sports activities that fostered team spirt and workplace camaraderie.

19.7 Grievance Redressal

To promote fair and equitable employment relationship, a scheme for Grievance Redressal of employees is also in place which ensures a time bound redressal of grievances.

20. Auditors

Statutory Auditor(s)

M/s O.P. Totla & Company and M/s KGRS & Co., Chartered

Accountants, have been appointed as Joint Statutory Auditors by Comptroller & Auditor General of India to audit the accounts of the Company for the financial year 2025-26 under Section 139 of the Companies Act, 2013, vide its communication

No./ CA.V/COY/CENTRALGOVERNMENT,IRLYFC(1)/124 dated

15th December 2025.

The Statutory Auditors have issued their Independent Auditors Report for the Financial year 2025-26 on 14th May, 2026. Pursuant to the observations of the Comptroller and Auditor General of India, they have issued a revised Independent Auditors Report on 16th July, 2026, which supersedes earlier Report dated 14th May, 2026. There is no change in the auditors opinion on the financial statements from that expressed in the earlier report. The Independent Auditors Report forms part of this Annual Report.

The Comptroller & Auditor General of India (C&AG) has undertaken supplementary audit on accounts of the Company for the year ended 31st March 2026 and have ‘Nil comments for the year ended 31st March 2026.

Secretarial Auditor

M/s VAP & Associates, Practicing Company Secretaries (Firm Registration No. S2014UP280200), have been appointed as

Secretarial Auditor of the Company for the Period of (5) five years commencing from FY 2025-26 to FY 2029-30, pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The appointment was approved by the shareholders at the 38th Annual General Meeting of the Company held on 30th August 2025.

In terms of Section 204 of the Companies Act, 2013 and Rules made thereunder, M/s VAP & Associates have issued Secretarial

Audit Report for the Financial year 2025-26, which is annexed to this Report as ANNEXURE V.

21. Debenture Trustees

In compliance with SEBI (Listing Obligations & Disclosure

Requirements) Regulations, 2015 the details of Debenture

Trustees appointed by the Company for different series of its bonds / debentures issued from time to time, are given in Corporate Governance Report which is enclosed as ANNEXURE-II.

22. Other Disclosures under the applicable provisionsof the Companies Act, 2013

22.1 Number of Meetings of the Board

The details of number of meetings of the Board are given in Corporate Governance Report which is enclosed as ANNEXURE-II.

22.2 Certificate of Independence by Independent Director

Independent Directors of the Company have given a declaration that they meet the criteria of Independence, as laid down under Section 149 (6) of the Act, SEBI (LODR) Regulations, 2015 and DPE Guidelines on Corporate Governance for CPSEs.

Further, the Independent Directors of the Company are nominated / appointed by the President of India acting through the administrative ministry, i.e., Ministry of Railways (MoR). Accordingly, the appointing authority considers the integrity, expertise and experience of the individual to be nominated / appointed.

22.3 Material changes, if any, that may affect financial position of the Company

There were no material changes and commitments affecting financial position of the Company during the year under review i.e. from 1st April 2025 to 31st March 2026.

22.4 Information in Corporate Governance Report

Information on composition, terms of reference and number of meetings of the Board and its Committees held during the year, establishment of Vigil Mechanism/ Whistle Blower Policy and weblinks for familiarization Programmes of Directors, Policy on Related Party Transactions, Remuneration paid to Functional Directors and Key Managerial Personnel, sitting fees to Directors and details regarding IEPF etc. have been provided in the ‘Report on Corporate Governance, prepared in compliance with the provisions of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and DPE Guidelines on

Corporate Governance, 2010, as amended from time to time, which forms part of this Annual Report.

22.5 Internal financial control systems and their adequacy

The details are given in Management Discussion and Analysis.

22.6 Audit Committee

The details pertaining to the Audit Committee are included in the Corporate Governance Report, which is enclosed as ANNEXURE-II.

22.7 Secretarial Standards

Your Company complies with applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

22.8 Certificate on Corporate Governance

The requisite Certificate received from the Secretarial Auditor of the Company, M/s VAP & Associates, Practicing Company

Secretaries, in respect of compliance with the conditions of Corporate Governance as stipulated under Regulation 34(3) read with Clause E of Schedule V of the SEBI (LODR) Regulations, 2015, is attached as ANNEXURE-VI and forms part of the Annual Report.

22.9 Risk Management

The details are given in Management Discussion and Analysis. Further, the Company is having a Risk Management Committee

("RMC") of its directors in place, for monitoring the integrated risks of the Company. The details pertaining to Risk Management Committee are included in the Corporate Governance Report, which is enclosed as ANNEXURE-II.

22.10 Risk Based Internal Audit

RBI vide its circular February 3, 2021, had mandated the Risk Based Internal Audit (RBIA) framework for all non- deposit taking NBFCs with asset size of 5000 Crore and above. In line with the RBI notification, Risk Based Internal Audit (RBIA) policy has been formulated and approved by the Board of Directors. RBIA will help the organization to identify the risks and address them based on the risk priority and direction provided by the Board. A firm of Chartered Accountant has been appointed as an expert to assist the Risk Based Internal Audit. The scope of RBIA is well defined and is very exhaustive to take care of all functions and business of the Company depending upon the risk assessment and control environment. Based on RBIA report, steps are taken at regular intervals to further strengthen the existing systems and procedures.

22.11 Particulars of loans, guarantees and investments

The particulars of loans, guarantees and investments have been disclosed in the financial statements, which forms part of this Annual Report.

22.12 Transactions with related parties

The particulars of the transactions with related parties have been disclosed in the financial statements.

22.13 Stock Options

The Company has not issued any stock options to the Directors or any employee of the Company.

22.14 Significant and Material Orders passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company

There are no significant and/or material orders passed by theRegulators or Courts or Tribunals impacting the going concern status of the Company.

22.15 Disclosure under Foreign Exchange Management Act, 1999

The Company is in compliance with the relevant provisions of the Foreign Exchange Management Act, 1999 pertaining to external commercial borrowing and derivatives.

22.16 Extract of Annual Return

The extract of Annual Return is given in ANNEXURE-VII which forms part of this report. After filing of the annual return for FY 2025- 26 with MCA, the same will be uploaded on website of the Company at https://irfc.co.in/investors/annual-return .

22.17 Code of Business Conduct-Declaration by CEO

Declaration by CEO on compliance of the "Code of BusinessConduct and Ethics for Board Members and Senior Management" for the year 2025-26 is placed at ANNEXURE-VIII.

22.18 CEO/CFO Certification

As required under Regulation 17 (8) of the SEBI (LODR)

Regulations, 2015, the Compliance Certificate as specified in Part B of Schedule II of the said Regulation duly signed by Shri Manoj Kumar Dubey, Chairman and Managing Director & CEO and Shri Randhir Sahay, Director (Finance) - Additional Charge & Chief Financial Officer (CFO) was placed before the Board of Directors in their Meeting held on 14th May, 2026. The same is enclosed as ANNEXURE-IX.

22.19 Particulars of Employees receiving high remuneration & other particulars of employees

Since IRFC is a Government Company, provisions of section 197 are not applicable. Hence, the details have not been given.

22.20 Deposits from public

The Company has not accepted any fixed deposits during the period under review and the Board of Directors has passed requisite resolution in this regard, in compliance of

RBI guidelines.

22.21 Cost Records

The Central Government has not prescribed the maintenance of cost records for the products/services of the Company under the Companies (Cost Records and Audit) Rules, 2014 read with the Companies (Cost Records and Audit) Amendment Rules, 2014 prescribed by the Central Government under Section 148 of the Companies Act, 2013. Accordingly, cost accounts and records are not required to be maintained by the Company.

22.22 Conservation of Energy, Technology Absorption

Pursuant to the Provision of Section 134(3)(m) of the Companies Act, 2013, in respect of Conservation of Energy and Technology absorption, following steps have been taken by your Company: -

To save power, the Company purchases LED/ LCD monitors while replacing the old monitors. Employees are encouraged to keep their gadgets in power saving mode, wherever possible.

The Company now replaces its old electrical items, gadgets, etc. with power efficient units. The internal lightning of office by energy- efficient LED lights has helped to conserve electricity.

The implementation of digital systems, including e-Office and ERP, has contributed to energy conservation across the organisation. Reduced reliance on physical files has led to a significant decline in paper usage and printing. This has lowered energy consumption associated with printing and document handling. The shift to digital workflows has improved efficiency while supporting sustainable practices.

22.23 Foreign exchange earnings & outgo

Your Company has put in place Comprehensive Risk Management policy to manage risks associated with foreign currency borrowings. The Company enters into hedging transactions to cover exchange rate and interest rate risk through various instruments like forwards and swaps. Details of Foreign exchange earnings & outgo have been given in the Notes to Accounts.

22.24 Expenditure on R&D

This is not applicable, as IRFC is engaged only in financing activities.

22.25 Reporting of Frauds by Auditors

During the year under review, neither the statutory auditors nor the secretarial auditor has reported to the audit committee, under Section 143(12) of the Companies Act, 2013, any instance of fraud committed against the Company by its officers or employees, the details of which need to be mentioned in the Boards Report.

22.26 Change in nature of Business

There was no change in the nature of business of the Company during the financial year 2025-26.

22.27 The names of companies which have become or ceased to be its Subsidiaries, joint ventures or associate companies

There are no Subsidiaries, joint ventures, or associate companies during the year 2025-26.

22.28 The details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year

There was no application made nor any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) against the Company.

22.29 Details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

There was no such instance of either settlement or loan from Bank or Financial Institution during the year under review.

23. Compliance of MSME Guidelines

Your Company has in place, a Manual for Procurement of Goods, Services and Works, which provides guidelines to expedite decision making process by way of consolidating, simplifying and streamlining the various steps to be followed in the process of award of contracts from the procurement of goods, works & services as well as during its implementation on the ground.

The procurement from MSEs complies to Public Procurement Policy during the financial year 2025-26 as placed below: (H in Crore)

1 Total annual procurement	8.31
2 Target % age of annual procurement (Procurement of Goods & Services through MSEs)	25%
3 Total value of goods and services procured from MSEs (including MSEs owned by SC/ ST entrepreneurs)	4.96
4 Total value of goods and services procured from only MSEs owned by SC/ST entrepreneurs	0.96
5 % age of procurement from MSEs (including MSEs owned by SC/ ST entrepreneurs) out of total procurement	59.69%
6 % age of procurement from only MSEs owned by SC/ ST entrepreneurs out of total procurement	11.55%
7 % age of procurement from Women MSEs	6.74%

24. Vigilance Activities

Ministry of Railways have nominated a part time Chief Vigilance Officer (CVO). The CVO carries out internal scrutiny of the activities on random basis to ensure compliance with the laid down CVC guidelines and procedures. During the vigilance awareness week preventive vigilance workshops were also conducted for the benefit of employees of IRFC. These workshops inter-alia cover contract management, provision of CDA Rules, compliances of rules and policies, deliberations of case studies etc., such workshops have ensured that best ethical practices are followed in the organization.

The Company has observed Vigilance Awareness Week in 2025-26 from 27th October, 2025 to 02nd November, 2025, on the theme "Vigilance: Our Shared Responsibility", in line with the circular issued in this regard by the Central Vigilance Commission. All employees were administered an Integrity Pledge, to spread awareness about vigilance amongst the employees, as well as public at large.

25. Official Language

The official language implementation committee of the

Company meets every quarter to monitor and review the progress made for achieving the targets fixed in Annual Program issued by the official language department Ministry of Home Affairs, Government of India. Effective measures were taken to bring out progressively higher use of Hindi in day-today working of the Company. Hindi workshops / trainings are regularly organized and for these employees are sponsored for the trainings/workshops.

Hindi week was observed in your Company from 14th September 2025 to 28th September, 2025 to motivate the employees for the progressive use of Hindi in their day to- day work. Several competitions / programmes were organized to encourage the employees to work in Hindi and create a conducive atmosphere. The participants were accordingly awarded. Further, cash award was also given to employees making most extensive use of Hindi in their day-to-day official work under the Government scheme.

The official website of your Company exists in bilingual form and contains all information of interest to its stakeholders.

26. Presidential Directive

Company has not received any Presidential Directive during the year under review.

27. Right to Information Act, 2005

The Government of Indias instructions on Right to Information Act, 2005 is being complied with. All relevant information has been hosted on the Companys website.

28. Changes in Directors & KMP

Being a Government Company, the power to appoint Directors on the Board of the Company is vested with the President of India acting through the Ministry of Railways (MoR), Government of India. Being a CPSE, the remuneration of Functional Directors, Key Managerial Personnel and other employees of the Company, including Senior Management Personnel, is determined as per the extant guidelines on pay, perquisites, allowances etc. issued by the Department of Public Enterprises (DPE) and/or Government of India from time to time. The sitting fee paid to Non- Official/ Independent

Directors for attending the meetings of Board and Committees thereof, are within the limits prescribed under the Companies

Act, 2013. The Government Nominee Director is not entitled to receive any remuneration or sitting fee from the Company, as per the norms of Government of India.

Details of remuneration and sitting fees paid to Directors are appearing in the ‘Report on Corporate Governance annexed to this Report.

Pursuant to Section 203 of the Companies Act, 2013, the Board of Directors of the Company has designated the Chairman and Managing Director as CEO, Director (Finance) as CFO, and Company Secretary (CS) as Key Managerial Personnel (KMPs) of the Company. Being a Government Company, the role of CEO is being performed by Chairman and Managing Director (CMD) and the role of CFO is performed by Director (Finance) of the Company.

The Changes in Directors & KMP during & after the year are brought out below: -

1. Shri Vallabhbhai Maneklal Patel (DIN: 07713055) has been co-opted as Non-official Independent Director on the Board of the Company w.e.f. 16th April 2025.

2. Ms. Shelly Verma (DIN: 07935630), who hold the post of Director (Finance), IRFC has superannuated from the servicesoftheCompanyon30thApril2025andaccordingly, has ceased to be a Director and Key Managerial Personnel of IRFC with effect from 1st May 2025.

3. Shri Randhir Sahay, (DIN: 10591482), IRAS, Executive Director Finance (S), Railway Board, has been entrusted the additional charge of the post of Director (Finance) in addition to his own, with effect from 01st May 2025 due to superannuation of Ms. Shelly Verma on 30th April 2025.

4. Shri Sunil Kumar Goel, ED(BD), has ceased to be Chief Financial Officer (CFO) with effect from 25th June, 2025.

5. Shri Randhir Sahay, Director (Finance), Addl. Charge, has been appointed as the Chief Financial Officer (CFO), with effect from 25th June, 2025 in place of Shri Sunil Kumar Goel, ED(BD).

6. Shri Baldeo Purushartha (DIN: 07570116), ceased to be a Part-time Government Nominee Director of the Company with effect from 4th December 2025, pursuant to the Ministry of Railways,

Government of India, Order No. 2022/PL/57/10 dated

3rd December 2025, received on 4th December 2025.

7. Shri Alok Tiwari (DIN: 11409207) , Joint Secretary, Infrastructure Finance Secretariat, Department of Economic Affairs has been appointed as Part-time Government Nominee Director on the Board of IRFC w.e.f. 05th December 2025 in place of Shri Baldeo Purushartha, till he holds the post of Joint Secretary, Infrastructure

Finance Secretariat, Department of Economic Affairs or further orders, whichever is earlier.

8. Shri Vallabhbhai Maneklal Patel (DIN: 07713055), Non -Official Director (Independent Director) ceased to be

Independent Director of the Company/IRFC with effect from 15th April 2026 upon completion of his tenure.

9. Shri Alok Tiwari (DIN: 11409207) ceased to be a Part-time Government Nominee Director of the Company with effect from 7th May 2026, pursuant to the Ministry of

Railways, Government of India, Order No. 2022/PL/57/10 dated 6th May 2026.

10. Ms. Laya Madduri (DIN: 11704330) , Joint Secretary, Infrastructure Finance Secretariat, Department of Economic Affairs has been appointed as Part-time Government Nominee Director on the Board of IRFC w.e.f. 07th May 2026 vide Ministry of Railways, Government of

India, Order No. 2022/PL/57/10 dated 6th May 2026 in place of Shri Alok Tiwari, till she holds the post of Joint Secretary, Infrastructure Finance Secretariat, Department of Economic Affairs or further orders, whichever is earlier.

11. As per the Ministry of Railways (MOR), Government of India Order No. 2024/E(O)II/40/1 dated 29th June 2026, the Board has co-opted Dr. Ranjay Choudhary (DIN:11796981) as an Additional Director designated as Director (Finance) on the Board of the Company for a period of five (5) years with effect from the date of his assumption of charge of the post i.e. 30th June 2026.

Accordingly, upon the assumption of charge by Shri Ranjay

Choudhary as Director (Finance)/IRFC, Shri Randhir Sahay relinquished the additional charge of the post of

Director (Finance) and the office of Chief Financial Officer (CFO) of the Company with effect from 30th June, 2026.

12. Ms. Deepa Kotnis, Executive Director (Finance)/IRFC, has been appointed as the Chief Financial Officer (CFO) and Key Managerial Personnel (KMP) of the Company with effect from 30th June, 2026.

Director(s) retiring & seeking appointment/ reappointment in the ensuing AGM

In accordance with the provisions of the Companies Act, 2013 and Article 210 of the Articles of Association of the Company, Ms. Laya Madduri (DIN: 11704330), Govt. Nominee Director shall retire by rotation at the ensuing 39th Annual General Meeting of the Company and being eligible, offers herself for re-appointment.

29. Evaluation of Board of Directors/ Independent Directors

As per the statutory provisions, a listed company is required to disclose in its Boards Report, a statement indicating the manner in which formal annual evaluation of the performance of the Board, its committees and individual Directors have been made and the criteria for performance evaluation of its Independent Directors, as laid down by the Nomination & Remuneration Committee.

However, the Ministry of Corporate Affairs ("MCA") vide its notification dated June 5, 2015, has, inter-alia, exempted Government companies from the above requirement.

Directors are evaluated by the Ministry or Department of the Central Government, which is administratively in charge of the company, as per its own evaluation methodology. Further, MCA vide notification dated July 5, 2017, also prescribed that the provisions relating to review of performance of Independent Directors and evaluation mechanism prescribed in Schedule IV of the Companies Act, 2013, is not applicable to Government companies.

Accordingly, being a government company, IRFC is, inter alia, exempted in terms of the above notifications, as the evaluation of performance of all members of the Board of the Company is being done by the administrative ministry i.e., the Ministry of Railways and/or by the Department of Public Enterprises (DPE).

30. ‘Think Green, Go Green Initiative

The Companies Act, 2013 permits companies to send documents like Notice of Annual General Meeting, Annual Report etc. through electronic means to its members at their registered email addresses. As a responsible corporate citizen, the Company has actively supported the implementation of ‘Green Initiative of the Ministry of Corporate Affairs (MCA) and effected electronic delivery of Notices and Annual Reports to shareholders, whose email ids are registered. The intimation of dividend (interim/ final) is also being sent electronically to such shareholders.

Further, pursuant to Section 108 of the Companies Act, 2013 read with Rule 20 of the Companies (Management and Administration) Rules, 2014, the Company is providing e-voting facility to all members to enable them to cast their votes electronically in respect of resolutions set forth in Notice of Annual General Meeting (AGM). The Company will also be conducting the AGM this year through video conferencing / other audio-visual means. Members can refer to the detailed instructions for e-voting and electronic participation in the AGM, as provided in the Notice of AGM. Members, who have not registered their e-mail addresses so far, are requested to register their e-mail addresses with the Registrar and Share Transfer Agent (R&TA) of the Company or their respective Depository Participant (DP) and take part in the green initiative.

The Company continues to strengthen its paperless initiatives by promoting digital documentation and online approval systems, thereby ensuring efficient governance, reduced paper consumption, and sustainable operational practices.

Additionally, the Company encourages shareholders to dematerialise their shareholding and opt for electronic communication, thereby contributing to sustainable and efficient capital market practices.

This initiative reflects the Companys commitment towards sustainability and responsible corporate practices.

31. Acknowledgements

Your Company is grateful to the Ministry of Railways, Ministry of Finance, Ministry of Corporate Affairs, Public Enterprises Selection Board, Department of Public Enterprises, National Informatics Centre, other Departments of the Government, Securities and Exchange Board of India and the Reserve Bank of India, for their co-operation, assistance, active and timely support, and guidance rendered from time to time. The Company is also thankful to all its Shareholders, Bondholders, Banks, Financial Institutions, Arrangers, Registrar and Transfer Agents, Bond Holders Trustees, National Stock Exchange of India Limited, BSE Limited and other stakeholders for reposing their confidence and trust in the Company. The Company looks forward to their continued support for sustaining its excellent performance levels. The Company expresses gratitude to the Comptroller & Auditor General of India, the Statutory Auditors, Secretarial Auditors and the Internal Auditors for their valuable support and guidance. The Board of Directors express appreciation for the dedication, commitment, and valuable contributions of the Companys officers and employees. Their unwavering efforts have enabled the Company to strengthen its position as one of the leading public financial institutions in the country and advance its strategic transformation under the IRFC 2.0 vision, marked by diversification into new sectors and expansion of its business portfolio, thereby creating a stronger foundation for sustainable growth and long-term value creation.

	For and on behalf of the Board of Directors
	Sd/-
	(Manoj Kumar Dubey)
Place: New Delhi	Chairman and Managing Director & CEO
Date: 30th July 2026	(DIN: 07518387)