HomeInvestment & Trading ›Cabinet Approves Listing of IREDA on Stock Exchanges

Cabinet Approves Listing of IREDA on Stock Exchanges

The mini--ratna firm will be listed on stock exchanges through an initial public offering (IPO). The government will sell part of its stake. Fresh equity shares will be issued to raise funds.

March 18, 2023. By Anurima Mondal

The government has given a nod for listing Indian Renewable Energy Development Agency Ltd. (IREDA) on the stock exchanges through an initial public offer (IPO) by the part sale of its stake in it to raise funds for the financial institution through the issue of fresh equity shares. The approval was given by the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi.

Due to the change in capital structure following the infusion of capital to the tune of INR 1,500 crore by the government in March 2022, the decision was the need of the hour. 

According to the statement issued, “This decision supersedes earlier CCEA decision taken in June 2017 for allowing IREDA (Indian Renewable Energy Development Agency) to issue 13.90 crore fresh equity shares of INR 10.00 each to the public on book building basis through IPO.”

Meanwhile, the listing process would be driven by the Department of Investment and Public Asset Management (DIPAM). 

The Initial Public Offer (IPO) will help in unlocking the value of the government’s investment as well as provide an opportunity for the public to acquire stake in the national asset and draw benefits therefrom. 

Apparently, it will help IREDA in raising a part of its capital requirement for meeting growth plans without depending on the public exchequer and improve governance through greater market discipline and transparency arising from listing requirements and disclosures.

Incorporated in 1987, IREDA is engaged in the financing of renewable energy (RE) and energy efficiency (EE) projects in India. Earlier this month, it received the status of ‘Infrastructure Finance Company’ Status from RBI. IREDA was earlier classified as an ‘Investment and Credit Company (ICC)’.

India aims to achieve 500 GW of non-fossil fuel-based electricity installed capacity by 2030 and IREDA is all set to play a significant role in this.

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