How Did IREDA Raise Rs 2,006 Cr to Enhance Green Financing?
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Synopsis
Discover how the Indian Renewable Energy Development Agency Ltd. (IREDA) successfully raised over <b>Rs 2,005 crore</b> through a QIP, significantly enhancing its capacity to support the renewable energy sector in India. This funding will empower IREDA to accelerate its green financing initiatives and bolster its financial stability, showcasing investor confidence.
Key Takeaways
- IREDA raised Rs 2,005.90 crore through a QIP.
- The issue was oversubscribed by 1.34 times.
- Funds will strengthen IREDA's Tier-I capital.
- The capital will enable increased investments in renewable energy projects.
- Investor confidence in IREDA has increased significantly.
New Delhi, June 11 (NationPress) The Indian Renewable Energy Development Agency Ltd. (IREDA) has successfully mobilized Rs 2,005.90 crore via a Qualified Institutions Placement (QIP). The funds were raised by issuing 12.15 crore equity shares priced at Rs 165.14 each, which includes a premium of Rs 155.14 over the face value of Rs 10, as stated in an official announcement made on Wednesday.
The issue price of Rs 165.14 indicates a 5 percent discount from the floor price of Rs 173.83 per share.
Initiated on June 5 this year, the QIP concluded on June 10, garnering a positive response from a diverse group of both domestic and international Qualified Institutional Buyers (QIBs), which included insurance firms, scheduled commercial banks, and Foreign Portfolio Investors.
The Board convened on Wednesday and approved the allotment of shares to eligible QIBs.
This QIP was oversubscribed, with bids totaling Rs 2,005.90 crore against a base issue size of Rs 1,500 crore, achieving a subscription rate of 1.34 times.
The capital raised will bolster IREDA's Tier-I capital and its overall Capital Adequacy Ratio (CAR), thereby enhancing the organization’s ability to support the growing renewable energy sector in India.
Pradip Kumar Das, Chairman & Managing Director of IREDA, remarked: “The successful completion of this QIP shortly after our IPO in November 2023 showcases the trust that the investor community and the Ministry of New and Renewable Energy have in IREDA.”
“This influx of capital will empower us to amplify our financing activities, facilitating increased investments in renewable energy projects and accelerating India’s transition to a greener and more sustainable energy future.”
IREDA reported a remarkable 49 percent increase in net profit, reaching Rs 502 crore for the January-March quarter of the financial year 2024-25, compared to Rs 337 crore in the same quarter of the previous year.
The country’s largest dedicated green financing NBFC also recorded a revenue of Rs 1,392 crore during the fourth quarter, representing a 37.7 percent rise from Rs 1,916 crore in Q4 of FY 2023-24.
Furthermore, the government-owned NBFC witnessed a 27 percent increase in loan sanctions during the fourth quarter, totaling Rs 47,453 crore, while loan disbursements rose by 20 percent to Rs 30,168 crore.
Point of View
This successful QIP by IREDA illustrates the increasing investor confidence in India's renewable energy sector. It highlights the vital role that financial institutions play in supporting sustainable development goals. As the country aims to enhance its green energy capacity, IREDA's efforts signify a positive step towards a more sustainable future, resonating well with national interests.
NationPress
14/06/2025
Frequently Asked Questions
What is Qualified Institutions Placement (QIP)?
Qualified Institutions Placement (QIP) is a method used by companies to raise capital by issuing equity shares to qualified institutional buyers, typically at a discount to the current market price.
How much capital did IREDA raise through the QIP?
IREDA successfully raised Rs 2,005.90 crore through the Qualified Institutions Placement.
What will the raised capital be used for?
The funds raised will enhance IREDA's capital adequacy and bolster its ability to finance renewable energy projects across India.
What was the response to the QIP from investors?
The QIP received an encouraging response from both domestic and foreign investors, resulting in oversubscription of the issue.
What is IREDA's role in the renewable energy sector?
IREDA serves as the leading financial institution supporting the growth of renewable energy in India by providing financing and investment options.
