What could be the future course of Navratna company IREDA of PSU sector? The stock is completely cold since last one month. In such a situation, what kind of strategy should investors adopt after the quarterly results? Brokerage ICICI Direct has given the answer on this, and has also made many important points regarding the stock.
Brokerage firm ICICI Direct believes that the company’s results in the second quarter have been good. Growth momentum looks better. This is likely to increase the valuation. ICICI Direct has advised to buy on IREDA. Also, from a 12 month perspective, the target price per share has been kept at Rs 280. According to this, a strong return of about 27 percent can be obtained from the current price of the stock.
The brokerage says that IREDA continued to have a strong performance in the second quarter. The company’s AUM has increased by 36 percent on an annual basis. Net interest income (NII) growth has also increased. The government’s focus is on entry into renewables and retail business to boost continued growth and margins. Approval has been given to raise Rs 4500 crore to keep the balance sheet strong for future growth. The stock is trading at 6.4x FY26 BV (~43x FY26E EPS).
As you know, IREDA was listed in November last year. The stock has given 270 percent return since the day of listing. At the same time, so far this year the stock has given a return of 110 percent. But the stock has given negative returns in the last one month. Due to which investors are in tension.
If we look at the numbers of the first and second quarter of the current financial year of the company, the situation becomes clear. During the September quarter of IREDA, the company’s net profit increased from Rs 284 crore to Rs 387 crore on an annual basis. The company’s revenue in the second quarter of FY25 stood at Rs 1630 crore. It was Rs 1176 crore in the same period last year. Apart from this, the company’s interest income has increased from Rs 360 crore to Rs 547 crore.
IREDA’s net profit in the first half of FY 2025 has been Rs 935.68 crore. It was Rs 81,943 crore in the same period of the last financial year. IREDA’s total income in the second quarter has increased from Rs 1.17,695 crore to Rs 16303 crore. The company’s total expenses in the second quarter increased from Rs 79,706 to Rs 17,047 crore. The company has said that it has repaid all its debts on time by September 30, 2024, be it debt securities, borrowings or any other liability.
Disclaimer: This information is for informational purposes only and should not be construed as investment advice. It is recommended to consult a financial advisor before making investment decisions.