MUMBAI : The initial public offering (IPO) of state-owned Indian Renewable Energy Development Agency Ltd (Ireda) opened on Tuesday and attracted investors across categories, reflecting the growing prospects for renewable energy financing in the Indian market.
In total, the IPO was subscribed 1.96 times, with bids received for a total of 921 million shares against the 471 million shares offered.
The response suggests that investors are confident about Ireda’s prospects as India’s largest green finance non-banking finance company (NBFC).
The institutional quota was subscribed 1.34 times, with bids for 179.9 million shares against 134 million shares offered. Demand from non-institutional investors, including high-net-worth individuals and corporate bodies, was even higher at 2.73 times with 274.2 million shares offered against 100.5 million reserved. The retail quota was subscribed 1.97 times with 462.6 million shares being offered against the 234.5 million offered.
The IPO will close on 23 November. The allotment for the IPO is expected to be completed on 29 November, and the shares are expected to list on the BSE and National Stock Exchange on 4 December.
The minimum lot size for an application is 460 shares.
The ₹2,150 crore IPO consists of a fresh issue of up to 403.16 million shares and an offer for sale (OFS) of up to 268.78 million equity shares by the President of India, acting through the Ministry of New and Renewable Energy.
IPO of Ireda, with a price band of ₹30-32, traded at a ₹6 per share premium in the gray market on Tuesday.
The gray market is the unofficial market where shares of an upcoming IPO are traded between investors before they are officially listed.
The gray market price, also known as the gray market premium (GMP), is the price that investors are willing to pay for shares in the IPO before the final listing price is known.
Ireda IPO reserved 50% of the shares in the public issue for Qualified Institutional Buyers (QIB), 15% for Non-Institutional Investors (NII), and 35% for Retail Investors.
Ireda’s diverse investment portfolio is valuable ₹47,206.66 crore, spanning 23 states and 5 UTs, positions it as a key player in India’s renewable energy sector. The company’s fund-based products include long-term, medium-term and short-term loans, collateral loans, bridge loans, takeover financing, loans secured against future cash flows, and lines of credit to NBFCs.
The company’s IPO is the first by a public sector company after the issue of Life Insurance Corporation in May 2022. It is expected to raise much-needed capital for Ireda to expand its operations and play a key role in India’s transition to renewable energy.
Milestone Warning!Livemint tops charts as the fastest growing news site in the world 🌏 Click here to know more
Catch all Business News, Market News, News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More or less
Updated: 21 Nov 2023, 21:59 IST