PSU stock jumps 4% after RBI revises priority sector lending guidelines for Renewable Energy

The shares of this public sector enterprise gained up to 4 percent after the Reserve Bank of India, announced changes to their Priority Sector Lending (PSL) guidelines. 

Price movement 

With a market capitalization of Rs 46,135.48 crore, the shares of Indian Renewable Energy Development Agency Ltd were trading at Rs 172.20 per share, increasing around 1.26 percent as compared to the previous closing price of Rs 170.05 apiece. 

Reason for fall 

The shares of Indian Renewable Energy Development Agency Ltd have seen bullish movement after The RBI’s revised Priority Sector Lending (PSL) guidelines expanded the classification of “renewable energy” loans.

Bank loans up to Rs 35 crore for renewable energy-based power generation and public utilities now qualify, encouraging greater investment in sustainable energy projects and promoting India’s clean energy transition. Moreover, In the December quarter, IREDA’s sanctioned loans more than doubled year-on-year, while its outstanding loan book grew 36 percent to Rs 69,000 crore. 

Financial performance 

Looking forward to the company’s financial condition, revenue zoomed by 35 percent from Rs 1,253 crore in Q3FY24 to Rs 1,698 crore in Q3FY25, during the same time frame net profit magnified by 26 percent from Rs 336 crore to Rs 425 crore. 

In H1FY25, the company’s disbursements were split across key sectors: Solar Thermal/SPV (26 percent), Wind (16 percent), State Utilities – Others (18 percent), Hydro Power (11 percent), State Utilities – Genco (3 percent), Manufacturing (6 percent), Ethanol (7 percent), and Others (3 percent), reflecting a diversified lending approach. 

Also read: Stock under ₹20 jumps after commissioning 100-KWP Solar Power Project in Uttar Pradesh

Renewable Energy Sector Expansion 

India aims to achieve 500 GW of renewable energy capacity by 2030, positioning IREDA as a critical player in financing these projects. The sector’s rapid growth, driven by government policies and technological advancements, ensures a robust demand for IREDA’s services. 

Diversification Plans 

IREDA plans to establish a retail subsidiary focusing on rooftop solar, electric vehicles, and other consumer segments. This diversification will help tap into emerging markets and enhance its portfolio

New development

On Oct 24, the company incorporated IREDA Global Green Energy Finance IFSC Ltd.; a WoS for retail businesses such as PM KUSUM, rooftop solar, and other B2c segments in RE and emerging RE sectors including EVs, Energy storage, Green Technologies, sustainability, Energy Efficiency, etc 

Company profile 

IREDA is the country’s largest pure-play green finance NBFC. It offers a full suite of financial products and services for Renewable Energy (RE) projects and adjacent value chain operations such as equipment manufacture and transmission, from project conception to post-commissioning. 

Written by Abhishek Singh

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