IREDA increased its gains by 11.4% to Rs 55.7 from its initial public offering price of Rs 50. At the same time, the stock was up 74% from its IPO price. Prior to the listing, the company's shares traded in the unlisted market at a premium of Rs 12.25. Investors responded enthusiastically to the IPO, which was 38.8 times oversubscribed, showing investor confidence in the company's solid fundamentals and development prospects.
Analysts feel that India has lofty renewable energy aspirations, and that IREDA, as the largest green financing NBFC, is best positioned to capitalize on the fast rising sector growth.
"We believe the listing premium is justified on the back of the company being tagged as a leading PSU player in renewable energy financing and advisory services and a possible upgradation from a Mini Ratna to a Navratna company in the near future which increases financial autonomy, allowing it to accelerate faster in the competition," said Prashanth Tapse, CEO of Mehta
The proceeds of the new issuance will be utilized to supplement its capital base in order to satisfy future capital requirements and to fund future lending. IREDA has an exceptional track record of nurturing and providing financial assistance for fresh and sustainable energy (RE) projects, as well as energy efficiency and conservation (EEC) efforts, spanning over 36 years.
The company is India's largest non-banking financial company (NBFC) committed to green financing. Its outstanding term loan portfolio stood at Rs 47,206 crore as of June 2023, indicating its diversified investment operations. The company's portfolio is geographically diverse, with term loans outstanding in 23 states and five union territories. Revenue climbed 47% to Rs 2,320 crore in the half year ending September 2023, while profit increased 41% to Rs 579 crore.
The company's standalone revenue from operations climbed 22% to Rs 3,482 crore in FY23, owing mostly to an increase in term loans outstanding. In the same quarter, net profit increased 36% to Rs 865 crore. For FY23, the capital to risk-weighted asset ratio (CRAR) was 18.82%, and for the June quarter, it was 19.95%.
