IREDA Share Price can cross Rs 260 for next 7 days, see what is the updated news
Indian Renewable Energy Development Agency (IREDA) has received approval from the Department of Investment and Public Asset Management (DIPAM) to raise up to Rs 4,500 crore through a Qualified Institutional Placement (QIP), diluting the government’s stake by up to 7% of the company’s post-issue paid-up equity.
The fundraise, approved by the Alternative Mechanism based on recommendations from a High-Level Committee, will be executed in one or more tranches. This follows an earlier in-principle approval from IREDA’s Board of Directors in August 2024, which considered multiple fundraising options, including a Follow-on Public Offer (FPO), Rights Issue, or Preferential Issue.
Main Points
IREDA’s Growth Plans and Loan Book
IREDA, a Mini Ratna (Category – I) government enterprise administratively controlled by the Ministry of New and Renewable Energy (MNRE), plans to raise Rs 30,000 crore in FY25 through debt and equity. The company, which listed on the bourses in November 2023, has been growing at a compounded annual growth rate of 24% for the last four years and aims to improve upon that.
As of June 30, 2024, the government owned a 75% stake in IREDA. The company’s outstanding loan book stood at Rs 63,207 crore in Q1 FY25, up 34% from Rs 47,207 crore in the year-ago quarter.
IREDA’s Q1 FY25 Results
IREDA reported a 30% jump in profit after tax (PAT) to Rs 384 crore for the June 2024 quarter (Q1 FY25). Revenue from operations grew 32% year-on-year (YoY) to Rs 1,510 crore during the quarter under review.
IREDA’s stock has seen a massive uptick from its initial public offering (IPO) price of Rs 32. The stock made its market debut at a premium of 56.25% to the issue price at Rs 50 on November 29, 2023.
On Wednesday, September 18, 2024, IREDA’s stock ended marginally lower by 0.15% at Rs 227.39. However, the stock has jumped nearly 120% so far in 2024. It hit a record high of Rs 310 on July 15, 2024, before slipping 15.27% to the current levels.
Analysts’ Views on IREDA
Analysts remain divided on the stock. ICICIDirect analysts are positive on IREDA’s growth prospects, given the government’s focus on the renewable sector. They value the stock at 49 times FY26E EPS, assigning a target of Rs 330 with a ‘Buy’ rating.
On the other hand, Phillip Capital analysts have maintained their ‘Sell’ rating with a revised target of Rs 130, stating that the recent rally in the stock is driven by passive flows rather than any major fundamental reason. They believe the best is already priced into the stock
