Cabinet approves Indian Renewable Energy Development Agency (IREDA) IPO

The shares will be issued to retail investors and IREDA employees at a discount of 5 per cent on the issue price of each equity share on book-building basis, with cap of 0.5 per cent on equity post issue for CPSE employees and the allocation to retail investors in the net offer will not be less than 35 per cent, as per the ICDR, 2009.

However, the number of shares proposed to be issued to employees and retail investors will be finalized in consultation with the lead managers and as per the SEBI regulations.

It has given its approval to conduct book building process for the said IPO by MNRE / IREDA through Book Running Lead Manager (BRLM) as per the guidelines of Department of Investment and Public Asset Management (DIPAM) and as per guidance of the Inter-Ministerial Group.

The Public issue of equity will enable IREDA to increase its equity base which will help them raise more debt resources for funding RE projects.

Such public issue will also enable it to unlock its true value and increase its visibility in domestic and international financial markets. 

IREDA, being the premier institution for RE Sector, will be required to raise equity funds to leverage loan financing for RE Sector.

IREDA has to cater to the increasing needs of the sector to sustain its contribution to the Renewable Energy Sector.

Government of India has scaled-up the RE targets to 175 GW by the year 2022. To achieve this ambitious target, substantial investments in RE sector will be required.

IREDA is a Public Financial Institution established in March, 1987  and is registered as Non-Banking Financial Company with the Reserve Bank of India.

Image: IREDA website