Shares of Indian Renewable Energy Development Agency (IREDA) rallied over 7% in opening trade on Thursday after the government-owned non-banking financial company (NBFC) informed exchanges that its board will meet next week to consider a fundraising plan. IREDA in an exchange filing last evening said that its board will meet on August 29 to consider raising up to ₹4,500 crore in one or more tranches through a further public offer (FPO), qualified institutional placement (QIP), rights issue, or preferential issue.
The fundraising is part of the company’s plan to raise ₹24,200 crore in the financial year 2024-25 through issuance of bonds, term loans, commercial paper etc. from domestic and international markets. In June this year, the renewable sector-focused NBFC garnered ₹1,500 crore via bonds.
Boosted by the development, IREDA shares snapped two session losing streak and gained as much as 7.5% to ₹256.90, while the market capitalisation rose to ₹68,915 crore. Early today, the PSU stock opened higher at ₹245.65 against the previous closing price of ₹238.90 on the BSE.
The share price of IREDA touched its all-time high of ₹310 on July 15, 2024, surging more than 6 times against its lowest level of ₹49.99 touched on its listing on domestic bourses on November 29, 2023. The NBFC stock has risen more than 870% against the initial public offering (IPO) price of ₹32 apiece.
“The board meeting of Indian Renewable Energy Development Agency Limited is scheduled to be held on Thursday, August 29, 2024, inter-alia, to consider and approve the proposal for raising of funds by way of equity share capital for an amount aggregating of up to ₹4,500 crore in one or more tranches through Further Public Offer (FPO) / Qualified Institutional Placement (QIP) / Right Issue / Preferential Issue or any other permitted mode or a combination, as may be deemed appropriate, subject to the statutory or government approval,” IREDA says in an exchange filing.
Established in 1987, IREDA is the only listed public sector NBFC that is solely focused on green energy sectors, engaged in promoting, developing and extending financial assistance for setting up projects relating to renewable sources of energy. As per the latest shareholding pattern, the central government holds a 75% stake in the company, while foreign portfolio investors (FPIs) increased their shareholding to 2.7%, compared to 1.36% in the March quarter. On the other hand, domestic mutual funds have reduced their stake in the company to 0.24% at the end of the June quarter, from 0.53% as of March 31, 2024, amid profit booking at higher levels.
As of June 30, 2024, the loan book of the company stood at ₹63,207 crore as against ₹47,207 crore in Q1 FY24, up by 33.8%. The NBFC sanctioned ₹9,210 crore loans during the quarter, up by 387% from ₹1,892 crore in the corresponding period last year. It disbursed loans to the tune of ₹5,326 crore compared to ₹3,173 crore in the same period last year.
On the asset quality front, IREDA’s gross NPA and net NPA improved on a sequential basis. In Q1 FY25, gross NPA stood at 2.19% as against 2.36% at the end of the March quarter, while net NPA improved to 0.95% from 0.99% in Q4 FY24.
For Q1 FY25, IREDA reported a net profit of ₹384 crore, up 30% over ₹295 crore in the year-ago period. The revenue from operations grew 32% to ₹1,502 crore as against ₹1,144 crore reported in Q1 FY24.
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