Indian Railway Finance Corporation Ltd (IRFC) fell nearly 2 per cent in Thursday's trade, with the stock slipping below the offer for sale (OFS) floor price of Rs 91 per share after the government exercised its oversubscription option.

The IRFC scrip opened at Rs 90.81 on BSE, down 1.86 per cent. The stock had declined 6.24 per cent on Wednesday and 2.16 per cent on Tuesday. The retail portion of the OFS opened for subscription on Thursday after the issue received strong demand from non-retail investors on the first day.

The Department of Investment and Public Asset Management (DIPAM), in a social media post, said the non-retail portion of the OFS was subscribed 1.86 times. Data available with BSE showed the issue received bids at an indicative price of Rs 91.10 per share, compared with IRFC's Wednesday closing price of Rs 92.53.

"We wish to exercise the oversubscription option to the extent of 11,24,02,040 equity shares (representing 0.86 per cent of the total paid-up equity share capital of the company) in addition to 13,06,85,060 equity shares of the company (representing 1 per cent of the total paid-up equity share capital of the company) forming part of the base offer size," IRFC informed stock exchanges.

Only retail investors can bid for shares in the OFS on Thursday. Non-retail investors who placed bids on June 24 and chose to carry forward their unallotted bids to the T+1 day will be allowed to revise their bids.

The total offer size has now increased to up to 24,30,87,100 shares, representing 1.86 per cent of IRFC's total paid-up equity share capital. Of this, 2,43,08,711 shares, or 10 per cent of the offer, have been reserved for retail investors, subject to valid bids.

"Additionally, 25,000 shares of the company (equivalent to 0.0002 per cent of the total issued and paid-up equity share capital of the company) will also be offered to the employees, as part of the offer," IRFC said.

IRFC would be the sixth PSU where the government has trimmed exposure in FY27 so far. Data showed the government owned 86.36 per cent stake in IRFC. It is required to pare its stake to 75 per cent to meet the minimum public shareholding norms. The government earlier cuts stakes in General Insurance Corporation of India (GIC Re), NLC India Ltd, NHPC Ltd, Coal India Ltd and Central Bank of India and raised Rs 16,479.89 crore.