IREDA Shares Drop 5.45%: Is This the Right Time to Buy?, Key Entry Range of ₹218–₹223 Explained
The Indian Renewable Energy Development Agency Ltd (IREDA) is experiencing significant fluctuations in its share price. The stock has been under pressure recently, with a notable decline of approximately 30% from its peak of ₹310 earlier this year. Currently, IREDA shares are trading around ₹220, reflecting a slight recovery of about 4.1% from previous lows. This article provides a comprehensive overview of IREDA’s current market situation, expected price targets, and the reasons behind the stock’s recent performance.
Main Points
IREDA shares have shown a downward trend over the past week, dropping by about 5.45%. Analysts attribute this decline to bearish signals indicated by various technical indicators, including the Moving Average Convergence Divergence (MACD) and Exponential Moving Averages (EMA). The stock is currently trading below its 100-Day Moving Average, which is situated near ₹224. The lack of major trading volumes during this decline suggests that the market may be stabilizing around current levels.
Market experts have set a short-term target price for IREDA shares between ₹250 and ₹265. Analysts recommend entering long positions within the price range of ₹218 to ₹223, with a stop-loss near ₹205 to manage risk effectively. A close above ₹235 could signal a potential resumption of upward momentum towards previous highs.
Several factors have contributed to the recent volatility in IREDA’s stock price:
- Strong Loan Sanctions: For the first half of the financial year ending September 30, IREDA reported an impressive 303% increase in loan sanctions, totaling ₹17,860 crore, compared to ₹4,437 crore during the same period last year. This growth indicates robust demand for renewable energy financing.
- Profit Growth: IREDA’s profit after tax rose by 36% to ₹387.75 crore in Q2 from ₹284.73 crore in the same quarter last year. Such financial performance is generally favorable for investor sentiment.
- Market Sentiment: Despite these positive indicators, market sentiment has been affected by broader economic conditions and investor caution regarding potential corrections after significant gains earlier in the year.
- Technical Indicators: The stock’s recent downtrend has been characterized by lower highs and lower lows, common in bearish market conditions. However, a potential reversal is indicated by a V-shaped recovery in the Relative Strength Index (RSI), which currently stands at around 33.
IREDA has received approval from the Department of Investment and Public Asset Management (DIPAM) to establish a wholly-owned subsidiary aimed at expanding its retail and B2B business in renewable energy. This move is expected to enhance IREDA’s market presence and diversify its revenue streams.
Summary of Key Metrics
| Metric | Value |
|---|---|
| Current Share Price | ₹220 |
| 52-Week High | ₹310 |
| 52-Week Low | ₹50 |
| Recent Weekly Decline | 5.45% |
| Loan Sanctions Growth | 303% |
| Profit After Tax Growth | 36% |
Disclaimer: The information given in this article is from investment experts and brokerage companies, they do not represent Local Haryana. Before taking any investment related decision, you must consult a certified expert.
