IREDA Board Approves ₹5,000 Crore QIP

resr 5paisa Research Team

Last Updated: 23rd January 2025 - 06:41 pm

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The Indian Renewable Energy Development Agency (IREDA) announced on Thursday, January 23, 2025, that it plans to raise ₹5,000 crore through a Qualified Institutions Placement (QIP) in one or more tranches. In an exchange filing, the Navratna PSU stated that its board approved the fundraising initiative during its meeting on the same day.

As per the company's conditions, the President of India's shareholding (via the Ministry of New and Renewable Energy) must not decrease by more than 7% of the post-issue paid-up equity share capital.

A QIP is a method used by listed companies to raise capital by issuing equity shares, convertible debentures, or other securities to Qualified Institutional Buyers (QIBs) such as mutual funds, foreign portfolio investors (FPIs), banks, insurance firms, and pension funds. However, retail investors are not eligible for this offering.

In September 2024, IREDA secured government approval to raise ₹4,500 crore through a fresh equity issue. The Department of Investment and Public Asset Management (DIPAM) granted its approval on September 18, 2024, for the company to proceed with this fundraising plan.

On January 9, 2025, IREDA reported a 27% YoY increase in net profit, reaching ₹425.38 crore for Q3FY25. Its total revenue from operations surged 35.6% YoY to ₹1,698.45 crore, while net interest income (NII) rose 39% YoY to ₹622.3 crore.

During the quarter, the company sanctioned ₹31,087 crore in loans, marking a 129% YoY increase compared to ₹13,558 crore in the same period last year. Loan disbursements grew 41% YoY to ₹17,236 crore, and the outstanding loan book expanded by 36% YoY to ₹69,000 crore.

As of the previous trading session, IREDA's share price had risen by 35% over the past year. The stock recorded a 52-week low of ₹121 on March 14 and a 52-week high of ₹310 on July 15 last year. Despite being 35% lower than its 52-week high, the stock remains 66% above its 52-week low.

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