Indian Renewable Energy Development Agency Limited (IREDA) saw its stock price edge higher by nearly 2% in intraday trading on March 17, 2025. Investors are closely monitoring the upcoming board meeting, where a crucial decision regarding the enhancement of the company’s borrowing plan for FY 2024-25 is expected.
The outcome of this meeting could have significant implications for share market investment in the renewable energy sector.
Strategic borrowing plan under review
IREDA has confirmed that its Board of Directors will convene to discuss an increase in its borrowing capacity for FY2024-25. This move aligns with the company’s broader growth strategy as it seeks to expand its lending portfolio in the renewable energy segment.
Investors engaged in share market investment are particularly interested in this development, as an increased borrowing capacity could strengthen IREDA’s financial position and funding capabilities.
Impact of RBI’s decision on equity investment
In a recent regulatory development, the Reserve Bank of India (RBI) declined IREDA’s request to make an equity investment in Nepal’s 900 MW Upper Karnali Hydro Electric Power Project. This joint venture includes partnerships with major industry players and state-run entities.
Despite this regulatory hurdle, IREDA remains committed to its long-term renewable energy investments, which continue to attract attention from those involved in share market investment.
Stock performance and market trends
IREDA’s stock touched an intraday high of ₹142.35, reflecting a 1.7% gain. However, it remains significantly lower than its 52-week peak of ₹310, recorded in July 2024, marking a 54% decline from those levels. On a positive note, the stock has recovered by 18% from its 52-week low of ₹121, reached in March 2024.
Over the past year, IREDA has delivered an 8.6% gain, though it has faced selling pressure in recent months. The stock declined 10% in March, following a 23% drop in February and a 6% fall in January. Analysts suggest that these fluctuations present opportunities for strategic share market investment, particularly as the stock approaches key technical support levels.
Technical insights and market projections
From a technical perspective, IREDA’s share price has broken below a crucial weekly swing low of ₹154, signalling a potential downside. Analysts indicate that the next strong support level is at ₹121, making it a probable accumulation zone for long-term investors.
The lack of significant institutional sell-offs suggests that this level could serve as a base for future recovery. Investors focused on share market investment should watch for stabilisation signals, as these could indicate a potential trend reversal.
Strong financial growth despite market volatility
Despite recent stock fluctuations, IREDA has maintained robust financial performance. In Q3FY25, the company reported a 27% rise in net profit, reaching ₹425.38 crore, compared to ₹335.53 crore in the same period last year. Revenue from operations grew by 35.6% year-on-year to ₹1,698.45 crore.
Sequentially, net profit increased by 10% from Q2FY25, while revenue saw a 4.2% quarter-on-quarter rise. This consistent growth reinforces IREDA’s position as a key player in the renewable energy financing space, making it an attractive consideration for share market investment.
Key financial indicators and investment outlook
Indian Renewable Energy Development Agency Limited is currently trading at ₹140, reflecting a 0.07% increase as of March 17, 2025, at 11:50 AM. With a market capitalisation of ₹37,602 crore, the stock’s price-to-earnings (P/E) ratio stands at 24.5, while its book value is ₹34.7.
Although the stock is trading at 4.02 times its book value, the company has demonstrated impressive profit growth, achieving a 33.9% compound annual growth rate (CAGR) over the last five years. However, investors should note that IREDA does not offer dividend payouts, which could be a consideration for those prioritising yield-focused share market investment strategies.
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