IREDA shares trading in double digits for second straight session; is the rally over?

Shares of Indian Renewable Energy Development Agency Ltd (IREDA) are trading below Rs 100 level for the second straight session today. The IREDA stock, which closed at Rs 101.94 on December 26, fell to an intraday low of Rs 95.57 in the current trading session. The multibagger stock closed at Rs 99.81 in the previous session. Despite the ongoing correction, the IREDA stock is still up 202.34% from its initial public offer (IPO) price in a month. From the listing price of Rs 50, the stock has rallied 94% in a month.

However, the stock is trading in the red today amid a strong rally in the market which indicates profitbooking in the state-owned stock.

In the current session, shares of IREDA slipped 4.24% to an intraday low of Rs 95.57 on BSE. Turnover was high with 104.46 lakh shares changing hands amounting to a turnover of Rs 101.59 crore on BSE. Market cap of the firm fell to Rs 26,033 crore.The stock hit a high of Rs 123.37 on December 14, 2023 and a low of Rs 49.99 on November 29, 2023.

ALSO READ: IREDA shares rose 215% from IPO price in a month; how strong is the uptrend?

On November 29, the stock of India's leading renewable energy financier listed at Rs 50 on BSE, a premium of 56.25% over the IPO issue price of Rs 32. The stock made its market debut at Rs 50 on NSE.

Those who were allotted shares during the IPO are sitting at a profit of Rs 68 per share from the IPO issue price of Rs 32. The stock listed at a premium of 56.25% to the issue price at Rs 50 on November 29.

Ravi Singh, Market Expert said, "IREDA stock price is currently witnessing profit booking and taking cues from the overall sentiments of the market. The technical parameters are suggesting more sell off in the coming days. The short term moving averages are supporting the current negative trend and may push the counter to lower levels of Rs 95 in the coming trading sessions."

Vaibhav Kaushik, Research Analyst, GCL Broking said, "The stock has a strong support near Rs 88 level. Buying on dips is advisable near Rs 97 level with a stop loss of Rs 88 for a target of Rs 120."

ALSO READ: IREDA shares fall 7.5%, overbought on charts; what's next?

Shiju Koothupalakkal - Technical Research Analyst, Prabhudas Lilladher said, "The stock has witnessed a decent rally recently after the listing to hit the high of Rs 123 level and thereafter has witnessed consolidation to form a flag pattern on the daily chart with near-term support at Rs 98 level. A decisive breach above 110 level shall trigger for further fresh upside move for next initial target of Rs 123 and thereafter with strength sustaining, shall expect for further target of Rs 131-133 levels."

Abhijeet from Tips2trades said, "IREDA stock price is overbought on the daily charts with strong resistance at Rs 123. Investors should book profits at current levels as a daily close below support of Rs 92 could lead to Rs 73 in the near term."

IREDA reported a 54% rise in its profit after tax (PAT) at Rs 285 crore for the second quarter of the fiscal year against Rs 185 crore in Q2 of the previous fiscal. Total income rose 49% to Rs 1,176.96 crore in the September 2023 quarter against Rs 791.56 crore in the September 2022 quarter.

Net NPAs fell to 1.65% in Q2 as against 2.72% in the corresponding quarter of the previous fiscal. Gross NPAs declined to 3.13% in the September 2023 quarter as against 5.06% in Q2 of the previous fiscal.

The price band of IREDA's IPO was Rs 30-32 apiece with a lot size of 460 shares. The IPO was open for bidding from November 21 to November 23. The state-run PSU player raised a total of Rs 2,150.21 crore through the IPO route, which included a fresh share sale of Rs 1,290.13 crore and an offer-for-sale (OFS) of 26,87,76,471 equity shares.

IREDA extends financial assistance for new and renewable energy projects, as well as energy efficiency and conservation projects. The company offers a comprehensive range of financial products and related services, from project conceptualization to post-commissioning, for RE projects and other value chain activities such as equipment manufacturing and transmission.

Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as an investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.