IREDA shares hit record high; up 35.46% since listing

Shares of newly listed state-owned power sector-focused financing company IREDA (Indian Renewable Energy Development Agency Ltd) hit an all-time high on Monday after the company announced the launch of its retail division, which targets PM-KUSUM, rooftop solar, and other B2C segments.

The stock opened a gap up at ₹74.64 and surged to an intra-day high of ₹85.02, hitting an upper circuit of 20%. At the current stock price of ₹85.02, the m-cap of IREDA stands at ₹22,851.38 crore. With this, the share price of IREDA has seen a more than 160% jump over the issue price of ₹32 on the NSE. The stock has also surged about 35.46% since the listing day on November 29, 2023.

The company last week announced the launch of its retail division, which became operational on December 5, 2023. Shortly after opening, IREDA’s retail division sanctioned its first loan amounting to Rs 58 crore under KUSUM-B.

Pradip Kumar Das, chairman and MD, IREDA also proposed a significant stride towards sustainable investing by suggesting a 1-2% Assets Under Management (AUM) allocation for domestic pension and insurance funds into renewable energy (RE) bonds. This he said aims to "deepen bond markets", fostering increased global and local investments. Das shared his insights in two panel discussions held at COP 28 in Dubai.

During a session on "Financing Industry Transitions in Emerging Markets and Developing Economies," Das vouched for finding and financing low-emission solutions to meet the rising energy demand. He emphasised the need for unique solutions across both traditional and new & emerging sectors.

Notably, IREDA had received an overwhelming response for its initial public offering (IPO) last month when its shares made a stellar debut. The share price of Miniratna company had listed at a 56% premium at ₹50 on the BSE and the NSE over the IPO price of ₹32 apiece. With this, IREDA became the second most successful PSU listing in the last decade after the Indian Railways Catering and Tourism Corporation (IRCTC), which debuted 101% above its IPO price in October 2019.

IREDA is the first PSU to list on stock exchanges after a long gap of 17 months post LIC's market debut in May 2022. As many as 22 PSUs went public in 2010, but most of them disappointed investors in terms of higher returns on investments. However, out of 22, seven PSUs including Rail Vikas Nigam (RVNL), IRCTC, Bharat Dynamics, MSTC, Mazagon Dock Shipbuilders, RITES, and Mishra Dhatu Nigam have managed to deliver strong returns to investors, with the stock prices more than doubling against their issue prices.

IREDA primarily focuses on financing power generation, transmission, distribution, and other activities. It provides a comprehensive range of financial products and related services, from project conceptualisation to post-commissioning, for RE projects and other value chain activities such as equipment manufacturing and transmission.

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