IDBI, BOB, and SBI Capital Chosen to Manage IREDA IPO for Renewable Energy Development
The Indian Renewable Energy Development Agency (IREDA) is set to go public with an initial public offering (IPO) in the near future. To oversee this significant event, the government has appointed IDBI Capital, BOB Capital, and SBI Capital as the lead managers for the IPO. The IPO is expected to consist of a 10% stake sale by the government and a 15% fresh equity issuance by IREDA, aimed at funding the growth of the renewable energy project financier.
Appointment of Lead Bankers and Legal Advisor:
IDBI Capital has been appointed as the lead banker for the IREDA IPO. The responsibility of managing the IPO process and ensuring its success will rest with IDBI Capital, along with support from BOB Capital and SBI Capital. Additionally, Saraf and Partners have been chosen as the legal adviser for the IPO, assisting in legal matters related to the offering.
Expected IPO Details:
The IPO of IREDA is anticipated to take place in the financial year 2023-24. It will comprise a 10% stake sale by the government and a 15% fresh equity issuance by IREDA. The primary purpose of the IPO is to generate funds necessary for the expansion of IREDA’s business operations in the renewable energy sector. Officials have expressed their intention to complete the IREDA listing within the current financial year.
Search for Advertising Agency and Registrar:
In a further move towards the IPO, the government has invited applications for hiring an advertising agency and a registrar for the IREDA IPO. These appointments will play crucial roles in promoting the IPO and ensuring a smooth process for potential investors.
Unlocking Value and Improving Corporate Governance:
The listing of unlisted state-owned firms, including IREDA, has become a priority for the Indian government. This initiative aims to unlock the hidden value in these companies and enhance corporate governance practices within them. The decision to take IREDA public follows the approval of the IPO by the Cabinet Committee on Economic Affairs (CCEA) on March 17.
IREDA’s Contribution to Renewable Energy Financing:
Established in 1987 as a wholly owned enterprise of the Government of India, IREDA specializes in financing Renewable Energy (RE) and Energy Efficiency (EE) projects across the country. Over the years, the company has played a significant role in supporting the growth of renewable energy capacity in India. IREDA has financed more than 3,068 RE projects, with cumulative loan sanctions and disbursements amounting to Rs 1.42 trillion and Rs 0.9 trillion, respectively. Its efforts have resulted in the addition of 19,502 MW of RE capacity in the country.
Financial Performance and Future Prospects:
In the first nine months of the financial year 2022-23, IREDA recorded a remarkable 50% year-on-year increase in net profit, reaching Rs 611 crore. This positive financial performance reflects the growing demand for renewable energy projects in India. With the upcoming IPO, IREDA aims to capitalize on its success and further expand its operations, contributing to the nation’s clean energy goals.