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PremiumIREDA Q2 Results 2024 Updates: Indian Renewable Energy Development Agency Ltd (IREDA) on Thursday reported an 36.2% year-on-year rise in its net profit for the fiscal's second quarter ended September (Q2FY25) to ₹387.75 crore. The company had reported a profit of ₹284.73 crore in the year-ago period. Sequentially, the net profit was up 1.1% from ₹383.69 crore in Q1FY25.
During the quarter, the company's Net Interest Income (NII) climbed by 51.9% to ₹546.86 crore from ₹359.8 crore in the same period the previous year.
IREDA announced its July-September quarter results for fiscal 2024-25 (Q2FY25) on Thursday, October 10 post market hours. IREDA share price ended 1.12% higher at ₹233.75 apiece on BSE ahead of Q2 results today.
IREDA reported a net profit increase of over 30% on July 12, 2024, reaching ₹383.69 crore for the (Q1FY25) June quarter, mainly because of higher revenues. Revenue from operations grew to ₹1,510.71 crore in Q1FY25 from ₹1,143.50 crore in the same period last year.
As of June 30, 2024, the company's net worth has increased to ₹9,110.19 crore from ₹6,290.40 crore, indicating a year-on-year growth of 44.83%.
On Wednesday, IREDA share price ended 2.92% higher at ₹231.15 apiece on BSE.
Stay tuned to our IREDA Q2 results 2024 live blog for the latest updates:
As per the company's filing, the outlook for India's RE sector is positive, with major policy announcements and ambitious targets.
During the quarter, the company's Net Interest Income (NII) climbed by 51.9% to ₹546.86 crore from ₹359.8 crore in the same period the previous year.
The Gross NPA stayed the same at 2.19%, and the Net NPA increased to 1.04% from 0.95% in the June quarter. The debt-equity ratio of the renewable energy financier was 5.85x, up from 5.83x in the previous quarter.
IREDA's total income stood at ₹1,630.38 crores during the quarter ended September (Q2FY25) from ₹1,176.95 crore in Q2FY24, a year-on-year jump of nearly 38.5%.
The Indian public sector enterprise's total revenue from operations stood at ₹1,629.55 crores during the quarter ended September from ₹1,176.63 crore in Q2FY24, a year-on-year jump of nearly 38%.
Indian Renewable Energy Development Agency Ltd (IREDA) on Thursday reported an 36.2% year-on-year rise in its net profit for the fiscal's second quarter ended September (Q2FY25) to ₹387.75 crore. The company had reported a profit of ₹284.73 crore in the year-ago period. Sequentially, the net profit was up 1.1% from ₹383.69 crore in Q1FY25.
Check out IREDA shareholding pattern as on June 2024
On Thursday, IREDA share price ended 1.12% higher at ₹233.75 apiece on BSE ahead of Q2 results today.
“The stock of IREDA demonstrates a tendency for sharp intermediate corrections. Currently, the stock has reached a support level of 207 after undergoing a 33% correction from its peak. A positive outlook is anticipated if the stock surpasses the 240 level, with potential upward movement towards the 265 and 305 levels. Furthermore, a bullish sentiment is expected to persist above the 208 level," said Kapil Shah, Technical Analyst, Emkay Global, and Technical Analysis Trainer at Finlearn Academy.
Both Power Finance Corporation and REC are currently placed at a make or break level of 200 sma. In the last couple of sessions, prices have defended this key support and have attempted to bounce back. For REC, this key support is at 500 and Power Finance Corporation at 470. As long as this key support holds, one can expect positive traction to happen in these counters, according to Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One.
At 15:04 IST, IREDA share price is trading 1.32% higher at ₹234.20. Prashanth Tapse, Senior Vice President of Research at Mehta Equities, stated that technically the stock had stared recovering from its recent lows of ₹206, and trading with reversal trend near ₹234 level. IREDA is showing a positive trend with strong support at ₹225 and resistance at ₹240. A breakout above ₹240 could lead to targets of ₹260 and ₹275. The RSI at 53 indicates neutral momentum but shows signs of an upward move. If the RSI continues to rise, the bullish momentum may strengthen, supporting higher price levels. A close above ₹240 is crucial for confirming further upside.
According to Prashanth Tapse, Senior Vice President of Research at Mehta Equities, state-run energy sector financing firm IREDA stock is in focus ahead of its Q2 earnings due today. Considering its business updates shared by the company IREDA reported a 303% increase in loan sanctions during the first half of the current fiscal year 2024-25, approving ₹17,860 crore worth of loans compared to ₹4,437 crore sanctioned during the same period last year which give a good indication that Q2 earnings can be better than Q1 earnings. If IREDA reports similar growth in its Q2 earnings we can expect the stock to trend up towards ₹260-280 range in short term.
IREDA, state-owned company, has been granted approval by the Department of Investment and Public Asset Management (DIPAM) to raise up to ₹4,500 crore through the issuance of equity shares to qualified institutional placement.
The approval was given based on the recommendations of a high-level committee, as stated in a company release. The fundraising will be conducted through the Qualified Institutions Placement (QIP) route, with the Government of India planning to dilute its shareholding in IREDA by up to 7% on a post-issue basis, to be carried out in one or more tranches.
“Given government’s focus on renewable sector, we remain positive on long term growth prospects which will aid long term sustained growth in AUM. Thus, we value the stock at ~49x FY26E EPS assigning a target of ₹330. Maintain Buy rating on the stock," the brokerage said.
“IREDA’s chart looks promising after a meaningful correction, where it found support at the previous breakout level around 205. The stock has since formed a bullish engulfing candlestick pattern. To confirm further upside, it needs to break above its 50-day MA at 238, which also aligns with the upper trendline of the downsloping channel. A breakout above this level could lead to targets of 265 and 285. Immediate support is at 227 and 217, while the 205-200 zone remains a critical demand area," said Meena.
As per ICICI Direct Research, a brokerage, the majority of borrowings (~84%) as of June 2024 were from domestic sources. With the highest "AAA" rating given to IREDA, long-term borrowing is now possible at competitive rates, bolstering profits. Because there are more loans with variable interest rates, the effect on margins over the medium term is unavoidable. On the other hand, steady AUM growth is predicted to support NII growth at a 26% CAGR in FY24–26E.
The brokerage predicts that IREDA will experience robust loan growth at a compounded annual growth rate of 25% from FY24 to FY26, driven by increasing demand for renewable energy in the country. However, it is anticipated that the earnings growth will not keep pace with the loan growth due to margin pressures. The higher reliance on the private sector and a significant portion of the at-risk portfolio do not instill confidence in maintaining low credit costs in the medium term.
The brokerage reports that India ranks as the third-largest producer and second-largest consumer of energy worldwide. As of December 2023, India's total installed power generation capacity was 428 GW, with renewable sources accounting for approximately 40% (about 172 GW).
The government's focus on increasing renewable capacity is aimed at reaching a target of 500 GW by FY30, requiring an investment of ₹24.43 trillion. IREDA, as specialised power financiers, is expected to have a significant role in funding renewable projects. Consequently, business growth is projected to maintain a healthy rate of around 25-30% CAGR in FY24-30E.
In about a year's period, Multibagger IREDA stock price has rosed 627.5% and outperformed its sector by 584.38%, as per trendlyne data. However, in the last three months, the PSU stock has fallen about 4%. On Thursday's session, ahead of the Q2 results, the stock was trading a bit flattish.
According to Dr. Ravi Singh, SVP, Retail Research, Religare Broking Ltd, the IREDA share price has seen a decent correction in the past few months, and now it is on the verge of a breakout from a falling trendline. The momentum indicators are suggesting that it may end its profit-taking phase and will resume the upward journey. So as an investor can maintain long positions with a stop at ₹205 with potential upside till ₹262.
"IREDA is set to announce its Q2FY25 results today, with expectations of a robust performance. Analysts predict a net profit of ₹410 crore, marking an impressive 44% year-on-year surge compared to ₹284 crore in Q2FY24. Sequentially, profits are expected to rise by 6.9% from ₹383 crore in Q1FY25.
This strong growth underscores IREDA’s pivotal role in financing India's clean energy transition. Investors will be keenly watching for updates on loan disbursements and any new initiatives as the company continues to fuel the country's renewable energy ambitions," said Jain.
The NBFC provides Solar, Hydro, Transmission, Biomass & Cogeneration, Wind, Energy Efficiency & Conservation, Ethanol, and Waste-to-energy under Traditional RE technologies.
Under the Emerging technologies category, the state-owned fund's product range encompasses Battery Storage System, Electric Vehicle & Charging Infra, Green hydrogen, Pumped Storage Hydro, Fuel Cells, and RE Component Manufacturing.
The range of products provided covers everything from the initial idea to the final implementation, such as Project Term Loans, Loan refinancing, Guarantee assistance for renewable energy suppliers, developers, manufacturers, and EPC contractors for bid security, Line of credit for NBFCs for on-lending, Loans secured against future cashflows, Additional loans, Loan syndication, Letter of comfort/Letter of undertaking, and Payment on order instruments.
The Department of Public Enterprises (DPE) granted the company Navratna status on April 26, 2024. With more than 37 years of experience, the company offers a wide range of financial products and services for the RE Sector and holds an Infrastructure Finance Company status as per RBI.
Based on reports from the news, brokerage firm PhillipCapital is anticipating that IREDA's net profit for the quarter ending on September 30, 2024 will be around ₹410 crore, marking a 44% increase compared to the ₹284 crore reported in the same period last year. It is also expected that the profit after tax (PAT) will increase by 6.9% compared to the ₹383 crore posted in Q1FY25.
The Net Interest Income (NII) for the quarter is estimated to be ₹522 crore, representing a 45% year-on-year increase from the ₹360 crore in Q2FY24. Additionally, a 2.7% increase is projected on a quarter-on-quarter basis, as stated in the Q2 preview note by the brokerage.
According to the report, PhillipCapital stated that the net interest margin (NIM) is expected to be approximately 3.21% for the July-September quarter, compared to 2.95% in the same period last year and 3.27% in the April-June quarter.
IREDA share price rises nearly 2% ahead of Q2 results today. Ruchit Jain, Lead Research Analyst at 5paisa said that IREDA share price is into a short term corrective phase, but the broader trend remains positive and hence, one should look to buy on declines. The support is seen in the range of ₹200-190.
In the current fiscal year, IREDA's loan approvals surged by 303 percent to reach ₹17,860 crore during the April-September period. Additionally, loan disbursements experienced a notable increase, rising by 56 percent to ₹9,787 crore from the ₹6,273 crore reported in September 2023.
“For the last few months, the IREDA stock prices have been trading in a slumber phase, witnessing a gradual low volume price correction. However, from the last few sessions we have seen positive traction, and we are seeing positive structure indicating a bullish reversal. We expect the stock has resumed its uptrend with 245 as next resistance and 220 as near-term support," said Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One.
Indian Renewable Energy Development Agency Ltd (IREDA), the renewable energy sector financier, is set to release its second-quarter results today. IREDA is a non-banking financial company (NBFC) owned by the government and focuses on providing financing for the renewable energy sector.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.
