The Indian Renewable Energy Development Agency (IREDA) has announced the price band for its initial public offering (IPO) at ₹30-32 per share. The state-run firm is looking to raise approximately ₹2150 crore ($264 million) through the public offering, which is scheduled to open next Tuesday.
IREDA, a government entity that backs renewable energy and energy efficiency projects, plans to issue up to 403.16 million new shares to raise around ₹1290 crore. In addition, the Government of India, currently the sole stakeholder, will offer up to 268.78 million shares in an offer for sale (OFS), aiming to garner Rs 860 crore.
The IPO process will commence with IDBI Capital, BoB Caps, and SBI Caps opening the anchor book on November 20. Following the price band announcement, the subscription window will officially open on November 21.
Investors interested in participating in IREDA's market debut will have until November 23 to place their bids. After the subscription period closes, the allotment of shares will be determined. Those not allotted shares will receive refunds starting on November 28, and IREDA is expected to make its stock market debut on December 1.
For the half-year ended September 2023, IREDA reported a gross non-performing asset (NPA) ratio of 3.13% and a net NPA ratio of 1.65%. The company maintains a strong capital adequacy ratio (CRAR) of 20.92% with a provision coverage ratio of 48.11%, indicating a robust financial cushion against potential losses.
Funds raised from the IPO are earmarked for several strategic initiatives, including investment in equipment manufacturing and transmission infrastructure. Additionally, IREDA intends to strengthen its capital base to support future financing needs in the renewable energy sector.
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