On January 23, the Indian Renewable Energy Development Agency (IREDA) announced that its board members have agreed to raise up to ₹5,000 crores by selling new shares through a method called Qualified Institutional Placement (QIP). This news was shared in an official exchange document. Following the announcement, IREDA’s stock price fell by 1.5% to ₹197.20 on the Bombay Stock Exchange.
IREDA’s stock has been quite unstable over the past six months, dropping around 27%, but it is up more than 32% compared to a year ago. In the previous year, IREDA’s board had also approved raising ₹4,500 crores through a similar share sale. Furthermore, the company is in the process of setting up a new retail division and has submitted its business plan to the Reserve Bank of India (RBI) for approval.
In the third quarter of FY25, IREDA faced some challenges with its assets. The percentage of loans that aren’t being repaid (called Gross Non-Performing Assets or GNPA) rose to 2.68% as of December 31, 2024, compared to the previous 2.19%. Similarly, the Net NPAs also increased from 1.04% to 1.5% during this time. The total GNPA was ₹1,845 crores, up from ₹1,465 crores in the same quarter last year, while Net NPA went from ₹757 crores to ₹1,024 crores.
Despite these asset quality issues, IREDA reported good financial results for Q3 FY25. Its net profit grew by 27% year-on-year, reaching ₹425.38 crores from ₹335.53 crores in the same period last year. The revenue from operations jumped by 35.6% year-on-year, rising to ₹1,698.45 crores from ₹1,252.85 crores.
When compared to previous quarters, profit after tax increased by 10% from ₹387.75 crores in Q2 FY25, and revenue saw a growth of 4.2% from ₹1,629.56 crores during the July to September quarter.
IREDA’s stock is currently down over 35% from its recent high of ₹310, reflecting the challenges facing the renewable energy financing sector and asset quality fears. Current data shows that the average target price for the stock is ₹215, suggesting it might go up from its present value. IREDA’s market capitalization is about ₹53,002 crores.
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