IREDA shares rise 28% in 6 sessions; is it time to book profits?

Shares of Indian Renewable Energy Development Agency Ltd continue to remain under the spotlight of investors as the state-run renewable energy player staged a strong rebound in the last few sessions, rising as much as 27 per cent since March 17, 2025. Stock analysts, however, continue to remain divided on the stock.

Shares of IREDA surged more than 28 per cent in just 6 sessions to Rs 176.80 on Tuesday, with the total market capitalization close to Rs 46,500 crore. The stock had settled at Rs 138.10 on March 17, just shy of its 52-week low at Rs 135.05 hit on March 27 2024. It ended Monday's session at Rs 170.05.

Interestingly, shares of IREDA have tumbled about 45 per cent from its 52-week high at Rs 310, hit in July 2024. Even after this sharp correction, the stock is still up 450 per cent from its IPO price at Rs 32, issued in November 2023. However, the stock is down 25 per cent from a year-to-date basis.

IREDA has corrected sharply from its recent highs. It has shown resilience and signs of a trend reversal. The momentum indicator RSI has rebounded from oversold levels and is currently positioned at 42, while the MACD has turned positive, indicating an improvement in momentum, which could support a short-term price rebound, said Geojit Financial Services.

The stock may advance towards Rs 155, which aligns with the 21-DMA and a key previous support level (red horizontal line). A sustained breakout above the 21-DMA could further propel the price toward the Rs 178–182 range in the coming sessions, said the brokerage.

IREDA is encountering resistance at the R3 Camarilla pivot, said Jigar S Patel, Technical Research Analyst at Anand Rathi Shares and Stock Brokers. "Given this sharp rally and the overhead resistance, we recommend booking profits in IREDA to safeguard gains and avoid potential downside risks. A fresh buy will only be triggered if IREDA closes above Rs 173 on the daily chart," he said.

The company board of IREDA is scheduled to meet later today to consider matters related to its borrowing plan for FY 2025-26. Last week, it launched its first-ever issue of perpetual bonds for an amount of Rs 1,247 crores at an annual coupon rate of 8.40 per cent, said the company in a media release.

IREDA’s loan book marked a strong growth of 36 per cent YoY to Rs 68,960 crore in 9MFY25. The expansion of the loan book is driven by a 41 per cent growth in disbursements during 9MFY25, reaching Rs 17,236 crore, said Geojit. IREDA’s asset quality improved during the quarter and 9MFY25, with the Gross NPA ratio reducing to 2.68 per cent, it said.

"The Government aims to achieve 500 GW of non-fossil fuel energy capacity by 2030, with 195 GW achieved by June 2024, highlighting the substantial scope for capacity expansion and financing needs. The stock is currently trading at a 1 year forward P/B of 3.4 time with ROA and RoE of 2.4 per cent and 20per cent, respectively," it added with a 'buy' and a target price of Rs 196.

Besides this, the Reserve Bank of India announced changes to their priority sector lending (PSL) guidelines on Monday, which also involved the renewable energy sector. As per the revised circular, the RBI wants to broaden the purposes based on which loans may be classified under 'renewable energy.'

Incorporated in March 1987, Indian Renewable Energy Development Agency is a 'Navratna' financial institution owned by the Government of India and administratively controlled by the Ministry of New and Renewable Energy (MNRE). It is actively promoting, developing, and extending financial assistance for new and renewable energy projects.

IREDA is among the latest entrant of F&O category, as announced by stock exchanges. Among the other brokerage firms, ICICI Direct has a price target of Rs 250 on IREDA, while Phillip Securities is bearish on the counter, with a target price of Rs 150.