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The Indian government is considering selling some of its stake in the state-owned Indian Railway Finance Corp (IRFC) as it aims to meet its divestment targets for the year, two government officials told Reuters on Wednesday.

The government owns a little over 86% of the Indian Railways' funding arm.

"The stake sale would take place soon," a government official said, adding that while the government is yet to decide the exact quantum of sale, it will aim to sell up to 11% in multiple tranches.

Last month, the government sold a more-than-5% stake in another state-run railways company, Rail Vikas Nigam, raising 13.66 billion rupees ($164.34 million).

So far in fiscal 2024, it has raised 56 billion rupees against a target of 510 billion rupees.

The Ministry of Finance did not immediately respond to a Reuters request for comment.

The sale would also have the added advantage of the government adhering to the regulator-mandated minimum public shareholding norms, which requires that public companies maintain at least 25% public shareholding.

While state-run firms have greater leeway in this regard, the government intends to bring down its shareholding in line with the norms.

Shares of IRFC have gained 58% over the last four weeks. The stock was trading at 51.55 rupees per share at 01.42 p.m. IST on Wednesday, up 1%.

($1 = 83.1202 Indian rupees)