India’s state-owned renewable energy financing firm IREDA has seen its stock price skyrocket since listing on the stock exchanges less than three months ago. According to a report on CNBC TV18, shares of Indian Renewable Energy Development Agency Ltd have risen over six-fold from their issue price of Rs. 32 during the initial public offering (IPO) in November 2023. 

In just 47 trading sessions since listing, IREDA’s stock price has surged to Rs. 200 as of February 2024, representing massive gains of over 550% for investors. The stock hit the 5% upper circuit limit once again on February 5th to breach the Rs. 200 mark. Such rapid appreciation in share value is extremely rare for a company, especially a public sector undertaking (PSU).

The stellar rise can be attributed to IREDA‘s strong operational and financial performance in the recent December 2023 quarter. Some of the key highlights:

  • Assets Under Management (AUM) grew 33.5% year-on-year to Rs. 80,000 crores, reflecting IREDA’s expanding portfolio of renewable energy projects.
  • Gross non-performing assets (NPAs) improved to 2.9% of total advances from 3.13% in the previous quarter, signifying better asset quality. 
  • Profit figures were not disclosed since IREDA is not required to report earnings each quarter as a PSU. However, business metrics suggest robust growth.

Technical indicators show the stock is currently in overbought territory, with its Relative Strength Index (RSI) above 70. However, the overwhelming response to IREDA’s IPO from institutional investors who subscribed 104 times and retail investors subscribing 7.7 times points to strong long-term demand.

Going forward, as India aggressively scales up renewable capacity addition to meet climate goals, IREDA is well-positioned to continue expanding its loan portfolio. If it maintains its current growth momentum while keeping asset quality in check, the company’s profitability could see sizable gains over the next few years.

For investors who were lucky enough to buy IREDA stock during its IPO, it has turned out to be a highly profitable investment. Even at current levels, the stock still holds potential for further upside as the renewable sector continues to flourish in India.

In summary, IREDA share price has risen over 6 times since its listing 47 trading sessions ago. The stock gained in 31 of those sessions, hitting an upper circuit of 5% today to cross ₹200. IREDA reported a 33.5% YoY rise in assets under management for Q3 FY23 along with improved asset quality.