 |
|
Indian Renewable Energy Development Agency Ltd (IREDA) has been in the spotlight following the release of its strong Q2FY25 results, which revealed a significant increase in net profit. The company's performance, coupled with the announcement of its plans to establish a wholly owned subsidiary for retail business, has sparked interest among investors and analysts alike.
IREDA reported a 36% year-on-year (YoY) surge in net profit, reaching ₹388 crore in the September 2024 quarter. This growth is attributed to the company's strong operational efficiency and expanding presence within the renewable energy sector. Notably, the company's net interest income (NII) also saw a substantial jump, increasing by 51.9% to ₹546.86 crore compared to the same period last year. Revenue from operations also experienced a positive trajectory, rising by 38.5% to ₹1,629.5 crore.
Looking ahead, IREDA's strategic move to establish a wholly owned subsidiary dedicated to retail business holds significant promise. This subsidiary will focus on various segments, including PM KUSUM, rooftop solar, and other business-to-consumer (B2C) areas within the renewable energy and emerging renewable energy sectors. This expansion encompasses electric vehicles (EVs), energy storage, green technologies, sustainability, and energy efficiency, reflecting IREDA's commitment to driving growth in these critical areas.
Analysts are optimistic about IREDA's future prospects, highlighting its strong operational efficiency and growing market presence. Anshul Jain, Head of Research at Lakshmishree Investment and Securities, pointed out that the government's planned 7% stake offload through an institutional share sale could enhance liquidity and marketability of IREDA's shares. Technically, IREDA's stock has been trading above most of its simple moving averages (SMAs), indicating positive momentum. The stock's relative strength index (RSI) suggests balanced trading conditions, while its position under the Additional Surveillance Measure (ASM) framework, though a factor to consider, does not deter long-term investors who see value in the company's strong base around the ₹230 level.
Overall, IREDA's impressive Q2 performance and strategic expansion into the retail market have positioned the company for continued growth. The company's strong fundamentals, combined with the potential for increased liquidity through the government's stake sale, have made IREDA an attractive proposition for investors seeking exposure to the burgeoning renewable energy sector.