IREDA debuts at 56% premium, closes 87% higher
Shares of state-owned green energy financier, Indian Renewable Energy Development Authority (IREDA), were locked in the upper circuit, or their daily permissible limit, on the stock-market debut Wednesday, mirroring the broader optimism that propelled the biggest benchmark index to reclaim 20,000 levels after nearly two months and underscoring undiminished investor appetite for new offerings anchored in sustainable growth.
The IREDA stock, which began the trading day at a 56% premium to the issue price at ₹50 a share, ultimately ended the day locked at the upper circuit — at ₹59.99 apiece.
That translates into an upside of 87.47% from the issue price. The ₹2,150-crore initial public offering (IPO) was sold to investors at a price band of ₹30-32 and had been subscribed 39 times, with the qualified institutional buyers' portion oversubscribed 104 times.
The stock surge, which takes the financier's valuations past the ₹16,000-crore mark, also points to immediate limited upside, although the extent of oversubscription and broader market trends might limit downside risks.
The company is also set to receive an upgrade in its status from the government this week.
«The shares of IREDA after the listing day up move are now available at a price-to-book ratio of 2 times, against our expectations of 1.6x. This makes its valuation above our comfort levels,» said Veer Trivedi, analyst at Samco Securities.
