Renewables lender IREDA hits over $1.8 billion valuation in trading debut
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Shares of Indian Renewable Energy Development Agency (IREDA) surged 80% in their trading debut on Wednesday as investors bet on government-led projects, valuing the state-owned firm at 155.22 billion rupees ($1.86 billion).
Shares of IREDA, which were listed at 50 rupees, climbed to a high of 57.75 rupees, well above their initial public offer (IPO) price of 32 rupees.
It was also the most heavily-traded stock, with over 458 million shares traded by 11:58 a.m. IST.
"The listing was above the market expectations...IREDA's strong financial performance and focus on the burgeoning renewable energy sector make it attractive," said Shivani Nyati, Head of Wealth, Swastika Investmart.
The domestic renewable energy sector is poised for significant growth in the coming years, propelled by government-led initiatives and increasing environmental concerns, Nyati added.
However, the company is valued much lower than its peers REC and Power Finance Corp, which are currently valued at $10.89 billion and $12.96 billion, respectively.
Last week, the IPO of IREDA - a non-banking financial company that focuses on renewable energy projects - received strong interest, and was oversubscribed 38.8 times.
India has seen a record 196 IPOs so far this year, during which the stock market scaled all-time highs as the country's economic growth prospects and a vast consumer base made it an attractive investment destination.
However, companies going public have had mixed responses, with some tepid debuts being attributed to market conditions, valuation concerns, or worries about competition.
These companies have raised about $5.97 billion, a 22.6% decline from the same period last year, according to data from LSEG.
IREDA's profit jumped 41.2% to 5.79 billion rupees in the half year ended Sept. 30, while its interest income climbed 49.1%.
The domestic equity market will see a multiple debuts this week, including Tata Motors -owned Tata Technologies, which will on Thursday mark the first listing from the Tata Group in nearly two decades.
