IREDA shares down 30% in 2025; caution advised

Shares of the Indian Renewable Energy Development Agency (IREDA) have fallen 30% in 2025 so far. On Friday, the stock rose by 3.30% to close at Rs 154.90. Despite this rise, IREDA's share price has seen a significant decline this year. IREDA plans to hold a board meeting on March 25 to discuss its borrowing strategy for the next financial year. The company has increased its borrowing limit by Rs 5,000 crore to a total of Rs 29,200 crore for FY25. Additionally, IREDA has launched its first issue of perpetual bonds worth Rs 1,247 crore with an 8.40% annual coupon rate. The company recently received a tax refund of Rs 24.48 crore for the 2011-12 assessment year and is in process of obtaining about Rs 195 crore in refunds for previous tax years. Market analysts suggest that IREDA's stock may remain weak in the near term. Some experts recommend not to buy the stock at current levels and advise existing investors to consider selling if the price rises. They note that the stock needs to consistently trade above Rs 166 to signal a more positive trend. IREDA's recent share performance reflects a larger issue of volatility. The stock has a price-to-equity ratio of 26.27 and is seen to be overvalued at its current levels. The company, which focuses on financing renewable energy projects, is considered a strong player due to government support, holding a 75% stake in the firm. IREDA is classified as a 'Navratna' public sector undertaking and plays a significant role in funding renewable energy and associated activities.