IREDA hits 20% upper limit; stock up 166% against issue price in 11 days

In March 2023, India announced a bidding trajectory targeting 50 GW of RE per year over five years. Financing for RE projects is typically ~75% debt-financed, and IREDA is one of the country’s only listed pure-play RE or green-focused lenders. It therefore represents a unique proxy, allowing investors to participate in the growth of RE-related financing in India without gaining exposure to non-green assets such as thermal power.

Will other lenders who operate across green and non-green segments seek to carve out their green-lending portfolios into distinct businesses along the lines of some power-sector players and auto manufacturers, who have done so for their RE and EV businesses, respectively?