Last Updated on March 14, 2024 by ethinos
The stock of the Indian Renewable Energy Development Agency, or IREDA, made a robust debut on the stock exchanges after the stock went public in early December 2023. The IREDA IPO share price was expected to rise after listing, and the stock was listed on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). IREDA came out with an IPO of a fresh issue of company shares worth ₹1,290 crore. The offer sale was to amount to ₹860.08 crore. The IPO came out as the company wished to raise funds and utilise the raised capital to boost future requirements and gain the advantages of becoming a listed company.
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By listing at a premium over the issue price of the IPO, the stock of the Indian Renewable Energy Development Agency delivered on its expectations of positive listing results. The shares changed hands and witnessed a high turnover on both the BSE and the NSE. With the IPO and the fresh listing of the company, the market capitalisation of the company witnessed a substantial increase. Most analysts agreed that the stock of IREDA seemed to appear bullish and would trade at significant highs compared to its issue price in the months following the new listing.
Details About the IREDA IPO
The Indian Renewable Energy Development Agency Limited came up with an IPO with the new issue of shares equal to ₹1,290 crore. The offer sale was to amount to ₹860.08 crore. The IREDA date of the IPO was from 21 November 2023 to 23 November 2023, and the listing date was scheduled for 4 December 2023. The IREDA IPO price was to be pegged at ₹30 – ₹32 per equity share and the IPO Lot Size was 460 shares. The IREDA IPO Total Issue Size was to be approximately ₹2,150 crore. The basis of allotment was slated for 29 November 2023, and refunds were to be given on 30 November 2023. The listing of shares was to be on the Bombay Stock Exchange and the National Stock Exchange.
Profile of the Company
Before applying for the IREDA IPO, investors may have read about the company profile in the company’s prospectus, and if you wish to invest in the company’s shares now, you must know about this company.
The Indian Renewable Energy Development Agency Limited was incorporated in 1987 and is owned by the Government of India. Administratively, it is managed and controlled by the MNRE or the Ministry of New and Renewable Energy. The company is categorised as a Mini Ratna Category I enterprise under the Indian government. Furthermore, the company has a historical track record of being one of the most reliable financial companies effectively involved in the promotion, development, and financial aid for new and renewable energy, energy efficiency, and conservation projects for more than 35 years.
IREDA provides a broad range of financial products as well as services of a related nature, starting from the conceptualisation of projects to the post-commissioning concerning renewable energy projects. The company is also actively engaged in value chain operations like transmission and the manufacture of equipment. The commitment of the company extends to supporting the transition towards a sustainable and green future. As a dependable partner, the Indian Renewable Energy Development Agency Limited assures customers of the best assistance and guidance in all applicable projects.
Additional Read: IREDA Share Price
Fundamental Analysis – Pre-IREDA IPO
It is not surprising that the IREDA IPO had a positive outcome given the fundamental analysis results of the company before the IPO came out. The IREDA IPO share price outcomes post the IPO are not surprising either. Preceding its IPO, the company showed promising growth in terms of its revenue, rising profits, and overall boosts in return measures. Nonetheless, while there was some risk with the company’s volatile EPS, equity expansion, NAV, and increased liabilities, this didn’t seem to stall subscription to the IPO when it came out. Here are the fundamental analysis measures in detail:
- Revenue Growth: IREDA has portrayed a consistent degree of growth in its revenue over the previous 3 financial years, implying a positive growth trend in its generation of income.
- Equity Expansion: From 2021 to 2023, the company has shown a substantial rise in equity. While this may imply prospective expansion, it is also indicative of the dilution of the ownership stake of present shareholders.
- Profit After Tax: The company has exhibited a positive financial growth rate with profits increasing over the past years.
- Management of Expenses: The revenue of the company has risen, but expenses have gone up as well. However, the rising expenses are not in proportion to the growth in revenue and this portrays some control on the company’s costs.
- Total Assets/Total Liabilities: Assets as well as liabilities have gone up consistently. While this shows growth, it also portrays potential financial obligations.
- Other Measures: The company’s net asset value is volatile, but there is a mild increase in 2023, the operating margin has robustly increased so there is efficiency in the generation of profit, but a decrease in EPS. Despite all the lows, the Indian Renewable Energy Development Agency Limited has shown positive return metrics with enhanced efficiency in using assets and equity to promote profits.
IREDA – An IPO Contender
With the IREDA IPO share price coming out strong post its IPO, and the fundamentals of the company being sound overall, the company shows a healthy growth path going ahead. Compared to its peers in the industry, like the Power Finance Corporation and REC Limited, IREDA has a competitive edge with a RoNW of 15.43%.
Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing. This content is for educational purposes only.
