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Union cabinet approves plan for IREDA to go public

LiveMint logoLiveMint 07-06-2017 PTI

New Delhi: The government approved a plan on Wednesday to publicly list state-owned Indian Renewable Energy Development Agency (IREDA) to fund its ambitious renewable energy development programmes. The decision was taken at a meeting of the Union cabinet chaired by Prime Minister Narendra Modi.

India, one of the world’s largest greenhouse gas emitters, targets to raise its renewable energy generating capacity to 175 gigawatt (GW) by 2022, and has reinforced its commitment to fight climate change even after US President Donald Trump pulled his country out of the Paris accord.

“Public issue of equity will enable IREDA to increase its equity base which will help them raise more debt resources for funding RE (renewable energy) projects,” the government said in a statement.

IREDA will issue 13.9 million shares at 10 rupees each in an initial public offering, the government said, without giving a time frame.

It will also issue shares to its employees at a 5% discount, the government said, without specifying the number of shares to be issued to them.

IREDA is a non-banking financial institution which provides loans for the development of renewable energy projects, with interest from such loans accounting for over 80% of its revenue.

The company made a consolidated net profit of Rs223 crore in the six months ended 31 March, up about 47% from a year earlier. Revenue rose 52% to Rs8,610 crore.

The cabinet approved a plan last month to raise Rs2,360 crore in bonds through IREDA for developing additional capacity in the renewable energy sector.

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