IREDA IPO opens on November 21; details here

Indian Renewable Energy Development Agency IPO opens on November 21

Pubilc sector enterprise Indian Renewable Energy Development Agency (IREDA) has decided to open its maiden public issue for subscription on November 21. This would be the fourth IPO in current month after ESAF Small Finance Bank, Protean eGov Technologies, and ASK Automotive.

The anchor book will be launched for a day on November 20, while the offer will close on November 23.

The price band for the offer will be announced in later part of the current week.

The 67.19-crore shares IPO comprises a fresh issue of 40.32 crore equity shares by the company and an offer-for-sale of 26.88 crore shares by the Government of India.

The non-deposit-taking non-banking finance company has reserved 18.75 lakh equity shares for its employees. The offer excluding employee portion is the net issue.

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Half of the net issue size is reserved for qualified institutional buyers, and 15 percent for high networth individuals. And the remaining 35 percent shares of the net issue size are kept aside for retail investors.

IREDA enjoys the infrastructure finance company status and provides financial assistance for new and renewable energy (RE) projects and energy efficiency and conservation (EEC) projects.

The state-owned company will utilise net fresh issue proceeds mainly for augmenting its capital base to meet future capital requirements and onward lending. As a government owned NBFC, it is required to maintain capital to risk weighted asset ratio (CRAR) of 15 percent.

The financial institution with more than 36 years of experience in the business of providing financial assistance for new and renewable energy projects, and energy efficiency and conservation projects recorded a 58 percent CAGR growth in net profit during FY21-FY23 and reporting profit at Rs 864.63 crore in FY23. Profit was at Rs 294.6 crore in Q1FY24.

IREDA will finalise the basis of allotment of IPO shares by November 28, and the equity shares will be credited to demat accounts of successful investors by November 29.

The trading in equity shares will commence with effect from December 1, i.e. T+6 timeline, as per the IPO schedule.

IDBI Capital Markets & Securities, BOB Capital Markets, and SBI Capital Markets are the merchant bankers to the issue, while Link Intime India is the registrar to the offer.