2023-05-19 17:47:16
The government is planning to offload up to 25% stake in IREDA.
It has decided to appoint SBI Capital Markets, BoB Capital Markets and IDBI Capital Markets and Securities as merchant bankers and Saraf and Partners as legal advisor for the IPO, said the official.
“We will talk to the merchant bankers and decide on a precise time-frame (for listing). Work is going on and listing is a function of various factors, including market conditions. We will take their advice and decide accordingly,” said the official.
In March, the Cabinet Committee on Economic Affairs (CCEA) approved the listing of IREDA to shed a part of the government’s stake and to raise funds for IREDA through the issue of fresh equity shares.
The government expects the IPO to help unlock the value of its investment and help IREDA raise a part of its capital requirement for growth plans without depending on the public exchequer. Moreover, the move is expected to “improve governance through greater market discipline and transparency arising from listing requirements and disclosures”, according to an official statement after the CCEA decision in March.
Last year, the government infused ₹1,500 crore capital into IREDA to improve its net-worth and bolster its capital-to-risk weighted assets ratio to spur lending for renewable projects. As of end-March, the company’s net-worth hit ₹5,935 crore, up 13% from ₹5,268 crore a year earlier.
IREDA, a mini ratna (category I) central public-sector enterprise, finances renewable energy and energy efficiency projects in India. It is registered as a non-banking financial company.
The company’s performance improved meaningfully last fiscal year. According to the official data, IREDA’s profit after tax jumped 36% on year in FY23 to Rs 865 crore. Its loan sanctions surged 36% to Rs 32,587 crore in FY23, while disbursements jumped 35% to Rs 21,639 crore.
Its loan book swelled 39% to Rs 47,076 crore as of March 2023 from a year earlier, and net non-performing assets moderated to 1.66% from 3.12%.
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