IREDA shares in focus as multibagger PSU reports 36% rise in Q2 profit

Multibagger stock: Shares of Indian Renewable Energy Development Agency Ltd (IREDA) are in focus today, as India’s largest pure-play green financing NBFC reported a healthy set of quarter results, with sales and profit rising 30-38 per cent for the September quarter. The PSU also registered healthy asset quality and expansion in margins. 

IREDA was established for the promotion, development and commercialisation of new and renewable sources of energy. It provides financial assistance to energy efficiency and conservation projects. The stock is up 123 per cent in 2024 so far and 290 per cent in the past one year.

For the September quarter, IREDA reported a 36.18 per cent year-on-year (YoY) rise in net profit at Rs 387.75 crore compared with Rs 284.73 crore in the same quarter last year. Revenue from operations rose 38.49 per cent YoY to Rs 1,629.55 crore from Rs l,176.63 crore in the year-ago quarter. The lender's net interest income (NII) was up 52.31 per cent at Rs 546.80 crore against Rs 359 crore reported a year earlier. Net interest margin (NIM) expanded to 3.34 per cent against 3.17 per cent YoY. Cos  of borrowing came in at 7.8 per cent against 7.85 per cent YoY. Provision coverage ratio (Stage III) came in at 52.98 pre cent) against 48.11 per cent.

Asset quality improved, with gross NPAs falling 5 per cent to Rs 1,415 crore from Rs 1m488 crore YoY, with gross NPA ratio falling to 2.19 per cent from 3.13 per cent in the year-ago quarter. IREDA said its outstanding loan book stood at Rs 64,564 crore for the first half of FY25, up 36 per cent over Rs 47,514 crore in the same quarter last year.

Sanctions for the quarter stood at Rs 8,650 crore against Rs 2,544 crore YoY, while disbursements for the quarter came in at Rs 4,461 crore against Rs 3,099 crore, YoY.

IREDA recently mentioned that the government is planning to offload a 7 per cent stake in the company through an institutional share sale.