Shares of Indian Renewable Energy Development Agency (IREDA) experienced a notable 80% surge in their trading debut on Wednesday, reflecting investor confidence in government-led projects. The state-owned firm is now valued at 155.22 billion rupees ($1.86 billion).
Listing at 50 rupees, IREDA shares reached a high of 57.75 rupees, surpassing their initial public offer (IPO) price of 32 rupees. The stock emerged as the most heavily-traded, with over 458 million shares changing hands by 11:58 a.m. IST.
Shivani Nyati, Head of Wealth at Swastika Investmart, noted, “The listing was above the market expectations…IREDA’s strong financial performance and focus on the burgeoning renewable energy sector make it attractive.”
While the domestic renewable energy sector anticipates significant growth driven by government initiatives and heightened environmental concerns, IREDA’s valuation remains comparatively lower than its peers REC and Power Finance Corp, currently valued at $10.89 billion and $12.96 billion, respectively.
IREDA’s IPO, a non-banking financial company specializing in renewable energy projects, garnered substantial interest last week, oversubscribed 38.8 times. The robust response aligns with India’s record-breaking year for IPOs, totaling 196 thus far, with the stock market reaching all-time highs.
Despite the positive trend, companies entering the market have experienced mixed responses, attributed to factors such as market conditions, valuation concerns, or competitive worries. Collectively, these companies have raised about $5.97 billion, marking a 22.6% decline compared to the same period last year, according to data from LSEG.
IREDA reported a 41.2% increase in profit, reaching 5.79 billion rupees in the half-year ended Sept. 30, with a 49.1% rise in interest income.
The coming week in the domestic equity market anticipates multiple debuts, including Tata Motors-owned Tata Technologies, marking the first listing from the Tata Group in nearly two decades, scheduled for Thursday.
