IREDA has seen a significant increase in its share
The Indian Renewable Energy Development Agency (IREDA) saw a significant surge in its shares during Monday’s trading session, rising by more than 19.97% to reach ₹85 per share on the NSE.
This notable increase was backed by considerable trading volumes and a notable surge in buyer interest, leading to a remarkable 32% rally in the stock over the last two trading days. Trading activity for IREDA remained robust, witnessing a total turnover of 210.51 million equity shares.
Standing out are the outstanding buy orders totaling 18.31 million equity shares on both the NSE and BSE. Currently, IREDA’s stock price has soared by an impressive 166%, surpassing its initial issue price of ₹32 per share since its market debut on November 29.
IREDA made a noteworthy entrance into the capital market, becoming the first public sector company to do so in over a year, following the debut issue of Life Insurance Corporation of India in May 2022. Its asset portfolio primarily focuses on solar energy (30%), followed by wind power (20.9%), state utilities (19.2%), and hydropower (11.5%).
As India’s exclusive non-banking financial company (NBFC) dedicated solely to renewable energy (RE), IREDA holds a distinctive position in the market, aligning itself among the limited entities capable of capitalizing on the significant growth potential in the renewable energy sector.
Recently, IREDA announced the establishment of its retail division in a regulatory filing after the market’s close on Friday. This strategic move aims to strengthen the company’s focus on providing loans for beneficiaries in the PM-KUSUM scheme, Rooftop Solar projects, and other Business-to-Consumer (B2C) sectors.
Analysts recommend considering a long-term investment approach in IREDA, not only for potential gains from its IPO but also in light of government initiatives to bolster the renewable energy sector. Despite its limited charting history due to its recent listing on November 29, some investors are optimistic about its potential to reach the ₹100 mark in the near future.
According to Nirmal Bang, sustained growth in IREDA’s loan book in the long term can be secured by diversifying and expanding into emerging green technologies. These include green hydrogen, pumped hydro storage power plants, the battery storage value chain, and the development of green energy corridors.
These emerging green technologies present substantial growth opportunities for IREDA’s loan portfolio. Green hydrogen, for instance, is gaining attention as a clean and efficient energy carrier that could revolutionize various sectors, including transportation and industrial processes.
Similarly, pumped hydro storage power plants offer grid stability and energy storage solutions, playing a crucial role in the renewable energy landscape. Furthermore, delving into the battery storage value chain aligns with the increasing demand for energy storage solutions, essential for optimizing renewable energy usage and ensuring consistent power supply.
This strategic expansion into diverse green energy corridors reflects IREDA’s proactive approach in staying at the forefront of the evolving renewable energy market. The company’s commitment to these green initiatives underscores its dedication to sustainability and aligns with the global shift toward cleaner and more sustainable energy sources.
With a solid foothold in renewable energy financing and a proactive stance toward embracing emerging technologies, IREDA appears well-positioned to capitalize on the growing demand for green energy solutions. Investors eyeing long-term growth potential in the renewable energy sector are closely monitoring IREDA’s strategic moves and expansion plans.
Green hydrogen, for instance, is gaining traction as an eco-friendly and efficient energy carrier with the potential to transform multiple industries, such as transportation and industrial processes. Additionally, pumped hydro storage power plants play a critical role in providing grid stability and storing renewable energy, contributing significantly to the renewable energy landscape.
The company’s focus on financing projects across various renewable energy segments and its recent market performance underline its importance as a key player in India’s journey towards a greener and more sustainable future. IREDA’s proactive approach in exploring and investing in these emerging green technologies signals its commitment to expanding its foothold in the renewable energy sector.
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