IREDA Introduces First-Ever Perpetual Bonds to Raise ₹1,247 Crore

Indian Renewable Energy Development Agency (IREDA), a state-owned renewable energy financier, has launched its first-ever perpetual bond to raise ₹1,247 crore. This move initially led to a slight increase in its stock price on March 20; however, the gains were short-lived as shares later declined. Additionally, the company has received a tax refund of ₹24.48 crore.

As of 2:30 PM IST, IREDA share price were trading at ₹149.89, a 1.27% decrease from its previous close on the NSE.

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According to an exchange filing on March 20, IREDA stated that the perpetual bonds were issued at an 8.4% annual coupon rate. The organization described this issuance as a significant step toward optimizing its capital structure while leveraging favorable market conditions.

IREDA considers the issuance of perpetual bonds a strategic measure to strengthen Tier-I capital and support the expansion of renewable energy infrastructure. Chairman and Managing Director Pradip Kumar Das highlighted that enhancing the company's capital base through these bonds will allow for increased financing of green energy projects, aiding India's shift toward sustainability.

Strengthening Financial Position and Expansion Plans

This development follows IREDA’s recent decision to increase its borrowing limit for FY25 from ₹24,200 crore to ₹29,200 crore. The additional borrowing will be sourced through various financial instruments, including taxable bonds, perpetual debt instruments, bank loans, external commercial borrowings, and short-term loans.

The increase in borrowing capacity aligns with the company’s growth strategy to accelerate the financing of renewable energy projects across the country. IREDA plays a crucial role in supporting India’s clean energy transition by providing funding for solar, wind, hydro, and bio-energy projects. With the government’s push toward achieving net-zero emissions by 2070, IREDA’s expansion is expected to contribute significantly to India’s renewable energy targets.

Over the years, IREDA has emerged as a key player in financing renewable energy initiatives, and this latest bond issuance is expected to provide additional flexibility in raising funds. The perpetual bond structure, which has no fixed maturity date, ensures that IREDA can maintain a strong capital base while leveraging market opportunities effectively.

Tax Refund and Pending Claims

Furthermore, IREDA announced on March 20 that it received a tax refund of ₹24.48 crore on March 19, linked to partial relief granted by the Commissioner of Income Tax (Appeals) for the Assessment Year (AY) 2011-12. The company is still awaiting approximately ₹195 crore in refunds for AYs 2010-11, 2012-13, 2013-14, and 2015-16 to 2018-19.

This refund provides additional liquidity, which can be reinvested into the company’s operations and financing activities. IREDA has been actively working toward optimizing its financial management and ensuring that pending tax claims are settled efficiently.

Stock Performance and Market Outlook

After experiencing a sharp decline of over 55% from its peak in July, IREDA shares have recently shown signs of recovery, breaking a six-day losing streak on March 19. Investors have been closely monitoring the company’s financial performance and strategic moves, including the issuance of perpetual bonds and increased borrowing capacity.

Market analysts believe that IREDA’s focus on capital expansion and renewable energy financing will strengthen its long-term growth potential. The company’s role as a key lender in the green energy sector positions it well to benefit from policy incentives and growing demand for sustainable energy solutions.

As India continues to prioritize renewable energy development, IREDA’s financial initiatives, including its perpetual bond issuance and increased borrowing capacity, will play a crucial role in meeting the nation’s clean energy goals. The company remains committed to scaling up investments in renewable energy infrastructure and supporting the transition to a low-carbon economy.