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Government to Limit IREDA Stake Dilution to 7% Through Rs50 Billion QIP

The Indian Renewable Energy Development Agency (IREDA), a public sector company under the Ministry of New and Renewable Energy (MNRE), has announced its intention to raise ?50 billion through a qualified institutional placement (QIP) of equity shares. This process will be executed in one or more tranches, adhering to legal requirements, with the government aiming to cap its post-issue equity dilution at 7%. The decision received approval from IREDA’s board of directors.

This fundraising initiative will help address India’s growing need for green energy financing. The country requires an annual equity investment of Rs900 billion to meet its target of adding 50 GW of renewable energy capacity each year for the next five years. Notably, foreign direct investment (FDI) in India’s renewable energy sector increased by 50% in the financial year 2023-24, rising to Rs315.84 billion from Rs206.5 billion in the previous fiscal year. IREDA has reported strong financial performance, with a profit after tax of Rs4.25 billion compared to Rs12.53 billion in the same period the previous year. For the year ending December 31, 2024, IREDA recorded significant growth in loan approvals and disbursements. Loan approvals surged by 129%, reaching Rs310.87 billion during the corresponding period in 2023. Similarly, loan disbursements increased by 41%, totaling Rs172.36 billion in 2023.