IREDA issues clarification on 'PDI/FPO' report; stock jumps 5%

State-run Indian Renewable Energy Development Agency Ltd (IREDA) has issued clarification on news reports referring to a follow-on public offering or FPO. "In this regard, this is to inform you that this information appears to be based on the recent interaction of Pradip Kumar Das, CMD, IREDA, with journalists at the company's registered office, New Delhi wherein a general discussion was held regarding the sector and company outlook. Considering renewable energy sector financing requirements, Das has just offered his view that IREDA may come up with Perpetual Debt Instruments (PDI)/FPO in the future keeping in view the business requirements," the state-owned firm stated.

"However, we would like to clarify that the company has not made any decision regarding FPO. The company will take up the matter with the Board of directors and the government at the appropriate time. The company states that the reported information in media is not correct," it further stated.

On the stock-specific front, IREDA surged 5.15 per cent to hit a high of Rs 193 in Wednesday's trade. The stock saw heavy trading volume on BSE today as around 41.99 lakh shares were last seen changing hands. The figure was higher than the two-week average volume of 23.83 lakh shares.

Turnover on the counter came at Rs 78.98 crore, commanding a market capitalisation (m-cap) of Rs 51,255.67 crore. There were 6,23,529 sell orders as against sell orders of 3,75,103 shares.

The renewable energy financier made a stellar stock market debut on November 29 last year. The company's initial public offering (IPO) price was Rs 32.

IREDA has recently incorporated a subsidiary at the International Financial Services Centre (IFSC) located in GIFT City, Gujarat. Prior to this, it was granted 'Navratna' status from the department of public enterprises.

Analysts at Choice Equity Broking have given a 'Buy' call on the counter with a target price of Rs 203. "IREDA presents a promising buying opportunity for those targeting a Rs 203 price objective, contingent upon implementing prudent risk management measures," they stated.

"To effectively manage risk, it is advisable to establish a stop loss at Rs 170 to protect the investment against unexpected market reversals. A prudent approach involves considering buying opportunities during market dips at levels around Rs 177," the domestic brokerage further said.

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "Support will be at Rs 170. A decisive close above Rs 190 level may trigger a further upside till Rs 200. The expected trading range will be between Rs 165 and Rs 210 for a month."

IREDA is a firm under the administrative controls of the Ministry of New and Renewable Energy. The organisation offers a comprehensive array of financial products (fund- and non-fund-based) associated services, from project inception to post-completion, for renewable energy projects and related activities like equipment manufacturing and transmission.