IREDA Files Draft Papers With SEBI To Raise Funds Via IPO

Indian Renewable Energy Development Agency Ltd (IREDA) has filed draft papers with the Securities and Exchange Board of India (SEBI) to raise funds through initial public offering (IPO).

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IREDA is the second public sector enterprise to hit Dalal Street after Life Insurance Corp.’s issue in May 2022.

As per the draft red herring prospectus (DRHP), the issue will comprise a fresh issue of up to 403.16 million shares and an offer for sale (OFS) of up to 268.78 million equity shares by the President of India, acting through the ministry of new and renewable energy. 

The company proposes to utilize the net proceeds from the fresh issue for augmenting its capital base to meet its future capital requirements and onward lending. IDBI Capital Markets & Securities Ltd, BOB Capital Markets Ltd, and SBI Capital Markets Ltd have been appointed as managers to the issue.

Incorporated in 1987 as Mini Ratna government enterprise, the organisation was formed to promote, develop and extend financial assistance to set up projects related to new and renewable sources of energy and energy efficiency/ conservation.

In fiscal year 2023, standalone revenue from operations saw a substantial increase of 21.75%, reaching Rs 3,481.97 crore compared to Rs 2,859.90 crore in the previous year. This growth can be primarily attributed to the expansion of its term loans outstanding during fiscal 2023.

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The company's net profit grew by 36.48%, rising from Rs 633.53 crore in fiscal year 2022 to Rs 864.63 crore in fiscal year 2023. In fiscal year 2023, the Capital to Risk-Weighted Asset Ratio ("CRAR") was 18.82%, and for the three-month period ending on June 30, 2023, it stood at 19.95%.