*Overview:*
Indian Renewable Energy Development Agency (IREDA) shares witnessed a recovery of nearly 15% from intraday lows, trading at ₹112.60 apiece on BSE at 10:30 IST. The stock had faced a decline of over 9% in early trading on Monday, leading to a cumulative fall of 18.25% in two sessions.
*Reasons for Decline:*
Profit booking was cited as the primary reason for the initial dip, with IREDA’s share price dropping from an intraday low of ₹98.26 to ₹103.80 after opening at ₹101.99 on BSE. Arun Kejriwal, Founder at Kejriwal Research and Investment Services, highlighted the need for correction after IREDA’s significant rise from the issue price of ₹32 to ₹125. He also mentioned concerns about the “fear of missing out” (FOMO) driving retail investors to buy without a full understanding of the stock’s value.
*Performance and Correction:*
IREDA’s share price made a stellar debut on November 29, listing at ₹50, a 56.25% increase from the issue price of ₹32. In just 11 sessions, the stock witnessed a remarkable 124% increase. The IPO had seen strong demand, being subscribed 38.80 times on day 3. Retail investors subscribed 7.73 times, NII portion 24.16 times, and QIB portion 104.57 times.
*Clarification and Market Response:*
Following the impressive rally, the National Stock Exchange (NSE) sought clarification from IREDA, to which the company responded that it had no new positive or material information affecting trading activity. The volatility in the stock’s price and volume was attributed to market-driven factors.
*About IREDA:*
IREDA, established in 1987 as an NBFC, focuses on providing innovative financing for renewable energy (RE) and energy efficiency projects. It operates under the administrative control of the Ministry of New and Renewable Energy, Government of India. In September 2023, IREDA was upgraded to Schedule A in the list of CPSEs by the Department of Public Enterprises, reflecting its significant standing in the sector. The company holds Mini Ratna (Category I) status since June 2015, as per the company’s RHP report.
Investors are advised to conduct thorough research and consider market conditions before making any investment decisions.
