⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
IREDA - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.8
| Stock Code | IREDA | Market Cap | 33,135 Cr. | Current Price | 118 ₹ | High / Low | 187 ₹ |
| Stock P/E | 17.6 | Book Value | 46.0 ₹ | Dividend Yield | 0.00 % | ROCE | 9.37 % |
| ROE | 18.0 % | Face Value | 10.0 ₹ | DMA 50 | 126 ₹ | DMA 200 | 144 ₹ |
| Chg in FII Hold | 0.15 % | Chg in DII Hold | -0.06 % | PAT Qtr | 585 Cr. | PAT Prev Qtr | 549 Cr. |
| RSI | 43.8 | MACD | -3.38 | Volume | 82,31,744 | Avg Vol 1Wk | 92,60,879 |
| Low price | 112 ₹ | High price | 187 ₹ | PEG Ratio | 0.45 | Debt to equity | 5.41 |
| 52w Index | 8.29 % | Qtr Profit Var | 37.5 % | EPS | 6.78 ₹ | Industry PE | 18.0 |
📊 Financial Overview
- Revenue & Profitability: PAT rose from ₹549 Cr. to ₹585 Cr. (QoQ), showing steady earnings growth.
- Margins: ROE at 18.0% is strong, but ROCE at 9.37% reflects moderate capital efficiency.
- Debt: Debt-to-equity ratio of 5.41 indicates high leverage, which is a concern.
- Cash Flow: EPS of ₹6.78 is modest relative to price, limiting earnings strength.
💹 Valuation Metrics
- P/E Ratio: 17.6 vs Industry PE of 18.0 → fairly valued compared to peers.
- P/B Ratio: Price ₹118 vs Book Value ₹46.0 → trading at a premium.
- PEG Ratio: 0.45 → suggests attractive valuation relative to growth.
- Intrinsic Value: Fundamentals are decent, but high debt and modest ROCE limit upside potential.
🏢 Business Model & Competitive Advantage
- Indian Renewable Energy Development Agency (IREDA) operates as a financing arm for renewable energy projects.
- Competitive advantage lies in government backing and focus on clean energy financing, aligning with India’s renewable energy push.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: ₹110–120 range looks safer given valuation and technical weakness.
- Long-Term Holding: Suitable for investors seeking exposure to renewable energy financing. Monitor debt levels and profitability trends closely.
✅ Positive
- Steady PAT growth (₹585 Cr. vs ₹549 Cr.).
- Strong ROE at 18%.
- PEG ratio (0.45) indicates attractive valuation relative to growth.
- FII holdings increased (+0.15%).
⚠️ Limitation
- High debt-to-equity ratio (5.41).
- ROCE (9.37%) reflects moderate capital efficiency.
- Dividend yield is 0%, limiting income support for investors.
📉 Company Negative News
- DII holdings decreased (-0.06%).
- Stock trading below DMA 50 & DMA 200, showing bearish technical trend.
- Stock corrected from high of ₹187 to current ₹118.
📈 Company Positive News
- Quarterly PAT growth of 37.5% shows strong momentum.
- FII inflows reflect rising foreign investor confidence.
🏦 Industry
- Industry PE at 18.0 highlights sector trades at similar multiples to IREDA.
- Renewable energy financing sector growth supported by government initiatives and clean energy adoption.
🔎 Conclusion
- IREDA shows decent fundamentals with strong ROE but faces challenges from high debt and moderate ROCE.
- Entry around ₹110–120 is favorable for long-term investors.
- Hold for exposure to renewable energy financing growth, but monitor debt levels and profitability consistency closely.