IREDA Share Price: 5 Reasons Why You Should Invest In IREDA

June 21, 2024 Divya Stuti

The Indian Renewable Energy Development Agency (IREDA) plays a vital role in India’s renewable energy sector. Established in 1987, IREDA focuses on financing renewable energy and energy efficiency projects. It operates under the administrative control of the Ministry of New and Renewable Energy (MNRE).

Importance of IREDA in the Renewable Energy Sector

IREDA supports India’s transition to sustainable energy. It funds projects that promote the usage of renewable resources, reduce greenhouse gas emissions, and enhance energy efficiency. IREDA’s initiatives are crucial for achieving India’s renewable energy targets.

IREDA operates under the Ministry of New and Renewable Energy. Its organizational structure has a Board of Directors, a Chairman and Managing Director, and several departments focusing on different aspects of renewable energy financing.

IREDA has financed numerous renewable energy projects across India, contributing significantly to the country’s renewable energy capacity. It has received several awards for its contribution to the renewable energy sector.

Running Projects:

IREDA finances a wide range of renewable energy projects, including:

Solar power plants
Wind farms
Biomass energy projects
Small hydro projects
Geothermal energy projects

These projects contribute significantly to India’s renewable energy goals.

Investors in IREDA:

The Government of India is the major shareholder with a 75% stake.
Other investors include retail investors, foreign institutions, and mutual funds.

Facts About IREDA Share Price:

Current IREDA Share Price (as of June 20, 2024): ₹177.50 (as of 15:30 IST)
Market Cap: ₹47,702 Cr
Listed in 2023, IREDA Share Price was ₹50
The stock surged 254% from its listing price, reaching a high of ₹215 in February 2024.
Currently, the stock is trading slightly below its peak but well above its 52-week low of ₹49.99.

Companies that have added IREDA to their portfolio:

ICICI Pru Life: ICICI Pru Life added 7,813,000 shares of IREDA.

HDFC Life: HDFC Life also acquired 7,227,000 shares of IREDA

Kotak Life: Kotak Life added 250,000 shares of IREDA

Should You Buy IREDA Shares Now?

India’s clean energy push is gaining momentum, and IREDA, the government’s financing arm for renewables, is at the heart of it. But is now the right time to jump on the IREDA share?

Here’s a quick look at the factors to consider:

Strong Financial Performance:

IREDA is firing on all cylinders.
In FY24, they reported a record annual profit of ₹1252 crore, a jump of 44.8% year-on-year [Mint, April 2024].
Loan sanctions also saw a massive 98% increase, reaching ₹23,407 crore [Hindustan Times, April 2024].
This strong performance indicates healthy growth and the company’s ability to capitalize on the growing renewable energy market.

Government Backing:

IREDA recently received “Navratna” status from the government, giving them greater operational freedom and faster decision-making [Mint, April 2024].
This translates to quicker project approvals and potentially more business opportunities.
Plus, with the government heavily invested in renewables, IREDA is likely to remain a key player in the sector.

Rising Demand for Renewables:

India’s renewable energy goals are ambitious.
The country needs to achieve 500 GW of installed renewable energy capacity by 2030 [Business Today, April 2024].
This translates to a massive need for funding, which is where IREDA steps in.
As demand for renewable energy projects surges, IREDA’s role becomes even more crucial, potentially leading to increased business and profitability.

Share Price Performance:

IREDA Share Price has seen a rollercoaster ride.
After listing at ₹50 in 2023, it soared to a high of ₹215 in February 2024 [Livemint, June 2024].
Currently, it’s trading around ₹177, offering a good entry point for long-term investors who believe in the company’s future prospects.

Analyst Opinions:

Experts are generally bullish on IREDA.
While some predict a short-term correction, many see long-term potential with a target price exceeding ₹200 [Livemint, April 2024].
However, remember, analyst opinions are not guaranteed.

Things to Consider:

Market Volatility: The stock market is very volatile. There’s always a risk of a downturn that could impact IREDA Share Price.
Competition: While IREDA is a leader, competition in the renewable energy financing space is increasing.
Government Policies: Changes or addition in government policies or regulations could affect IREDA’s business.

The Bottom Line:

Investing in IREDA offers an opportunity to participate in India’s clean energy growth story. Strong financials, government backing, and rising demand for renewables are all positive signs. However, do your research, understand the risks, and consider your investment goals for making right decision.

“This blog is for educational purposes only and should not be considered financial advice. Always do your research before making any investment decisions.”